Coinbase’s Base TVL Hit by Massive USDC Token Burn

Base, the Coinbase-incubated Layer-2 blockchain, faces challenges as its Total Value Locked takes a hit in the past week.

BASElogo being sad about burning USDC coin in a cartoony environment.
Created by Gabor Kovacs from DailyCoin
  • Coinbase’s Base, having been a rising star in the crypto world, has momentarily eclipsed Ethereum.
  • A steep drop in Base Network’s Total Value Locked has raised eyebrows.
  • Competition has heated up as Base has been grappling for its position among the top rollup projects.

Coinbase’s incubated Layer-2 blockchain, Base, has experienced a remarkable surge, briefly overshadowing the Ethereum mainnet. Utilizing Optimistic Rollup technology and developed within the Ethereum ecosystem, Base has garnered attention due to its OP Stack tech, riding the wave of increasing demand for alternatives in the crypto landscape.

Major Drop in Base’s TVL

Base’s Total Value Locked (TVL) faced a significant setback over the past week. According to L2Beat data, the TVL in Base Network plummeted by more than 18.28%, dwindling to $437 million within the last seven days.

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The substantial decline in Base’s TVL can primarily be attributed to a massive burn of Base USDC tokens on September 29. Dune Analytics data reveals a drastic drop from a peak of 160 million to a mere 29.84 million in a single day. This decline coincided with fintech firm Circle’s announcement of its USDC launch the previous month.

Base Plummets to Fourth Position as zkSync Era’s TVL Surges

Consequently, Matter Labs’ zero-knowledge (zk) rollup technology-powered scaling solution, known as zkSync Era, boasting a TVL of $476 million, surged ahead of Base, relegating Base to the fourth position.

Among the top five rollup projects, Base found itself in the red, while Arbitrum One and OP Mainnet displayed growth rates of 10.12% and 8.29%, amassing TVLs of $6.17 billion and $2.80 billion, respectively. Furthermore, zkSync Era’s TVL also witnessed a robust increase of more than 15% during the same period.

On the Flipside

  • Base’s ability to bridge over $459 million since its inception underscores its relevance and functionality in the crypto space.
  • Although zkSync Era surpassed Base in TVL during this period, different scaling solutions have distinct use cases and may attract different user bases.

Why This Matters

Base Network’s recent turbulence, marked by a substantial TVL decline, serves as a stark reminder of the market’s dynamic nature. As it vies for its position among rollup solutions, this event underscores the importance of innovation, competition, and resilience in the ever-evolving landscape of blockchain technology.

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To learn more about recent developments in Base’s TVL and its ongoing journey, read here:
Coinbase’s Base TVL Slumps Despite Friend.tech Strides

For insights into how Ripple leverages legal victories to fuel its expansion into Singapore, click here:
Ripple Capitalizes on Legal Wins to Make Singapore Expansion

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Kyle Calvert

Kyle Calvert is a cryptocurrency news reporter for DailyCoin, specializing in Ripple, stablecoins, as well as price and market analysis news. Before his current role, Kyle worked as a student researcher in the cryptocurrency industry, gaining an understanding of how digital currencies work, their potential uses, and their impact on the economy and society. He completed his Masters and Honors degrees in Blockchain Technology within Esports and Business and Event management within Esports at Staffordshire University.