Crypto exchange Coinbase has launched its own Layer 2 blockchain network to onboard millions of new web3 users.
In an announcement on Thursday, Coinbase unveiled the testnet of its new Ethereum-based Layer 2 network called “Base.” The network will serve as a home for both Coinbase’s on-chain products as well as new decentralized applications (dApps).
Like other Layer 2 networks, Base will function as a separate blockchain built atop a Layer 1 blockchain and help scale the underlying network by making transactions cheaper and faster. In this case, the base network is Ethereum and other interoperable chains.
Coinbase describes Base as “a bridge, not an island,” and plans to make its Layer 2 compatible with blockchain ecosystems like Solana and other Layer 2 networks like Optimism. In fact, Base is built on Optimism’s open source developer toolkit, OP Stack, which Coinbase has joined as a core developer.
5/ Base is Decentralizing.
Decentralization enables the cryptoeconomy to remain open and accessible to everyone
— Base (@BuildOnBase) February 23, 2023
Coinbase has also launched a Base Ecosystem Fund to invest in early-stage projects building on the network that meet its investment criteria.
The network will offer complete Ethereum Virtual Machine (EVM) equivalence at a fraction of the cost, said Coinbase, and developers will be able to set up gasless transactions for their dApps.By integrating directly with Base, developers can target onboarding the 110 million verified users and $80 billion worth of assets on the Coinbase ecosystem.
“We do not plan to issue a new network token for Base and will use ETH as the native gas token,” said Coinbase.
Shortly after the testnet went live, however, a number of users reported issues with the network’s functionality.
base's bridge is off to a rough start, every single transaction reverting and the bridge contract is unverified so nobody can figure out what's going on pic.twitter.com/2MiFZrMNfj
— foobar (@0xfoobar) February 23, 2023
“The bridge contracts bump up gas usage under load which wallets weren’t properly estimating,” explained Coinbase software engineer Roberto Bayardo on Twitter.
According to him, an unprecedented volume of users, some of which may have been bots, were likely behind the issues on the testnet’s launch.Check out our video explaining Base here.