Ethereum
Franklin Templeton expects this network to “remain a leader” on Ethereum – DL News
- Franklin Templeton expects Base to capture a significant share of the Ethereum Layer 2 market.
- Base is a major draw for memecoins and SocialFi projects.
- USDC is the main stablecoin on Base.
Only Arbitrum, with $2.6 billion, has more deposits than Base’s $1.6 billion among all layer 2 Ethereum networks, DefiLlama data shows, and in a note Published Thursday, Franklin Templeton said he expects Base to “remain a leader.”
Base is a layer 2 Ethereum blockchain that was launched by crypto exchange Coinbase.
Franklin Templeton, a $1.5 trillion asset manager, highlighted Coinbase’s “strong support” as a major positive for Base.
Base’s recent growth has been driven by memecoin trading and interest in so-called SocialFi projects, Franklin Templeton said.
“In recent months, Base has experienced a significant increase in activity, primarily driven by Base’s meme coin trading activity and SocialFi applications such as friend.tech,” the company’s note said.
Basics buzzing activity levels have resulted in increased transaction fees for Sequencer, the part of the Core network responsible for organizing, verifying and transferring batches of transactions to the Ethereum network.
Like other layer 2 Ethereum networks, Base has not yet “decentralized” its sequencer. All his revenue now goes to Coinbasethe entity responsible for executing the Sequencer.
Most of the spike in activity on Base occurred in March, when memecoin trading peaked. Some popular tokens included TOSHI and BRETT, with BRETT reaching a peak of $800 million in market value.
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Memecoin trading took place following Ethereum’s Dencun Upgrade that reduced transaction fees on Layer 2 networks up to 98%.
The Franklin Templeton report also states that “Base hit a home run” in the SocialFi niche.
“Currently, Base has [about] 46% for all SocialFi-related transactions,” the report said. “This category is a key vertical for grassroots adoption and growth.”
Before memecoins exploded on Base this year, ami.tech, a popular SocialFi project, was the main draw for activity on the network in 2023.
The growing adoption of Base users has also led to a large increase in the volume of stablecoins on the network. The market capitalization of stablecoins on Base reached $2.8 billion, according to at DefiLlama.
Circle’s USDC stablecoin accounts for most of the volume. This is not common in DeFi where Tether’s USDT is the dominant stablecoin on most blockchains.
Coinbase’s support for free USDC transfers to the base chain via the exchange’s wallet since December 2023 is likely a reason for the stablecoin’s popularity on the network.
Crypto market players
- Bitcoin is down 2.31% in the last 24 hours
- Ethereum fell below $3,000 again, down 3.1% today.
What we read
Osato Avan-Nomayo is our DeFi correspondent based in Nigeria. He covers DeFi and technology. To share tips or story information, please contact him at osato@dlnews.com.