- Coinbase’s CEO has revealed intriguing plans regarding its layer-2 network.
- The push towards faster and cheaper transactions has unveiled Coinbase’s ambitious goals.
- Armstrong has hinted at a potential industry consolidation around a few layer-2 networks.
In a recent move that has surprised many in the crypto community, Coinbase, the popular cryptocurrency exchange, has announced that it will not be introducing a token for its layer-2 network, Base. This decision comes as a bit of a departure from the norm, as many other layer-2 networks have their own native tokens. So why is Coinbase taking this different approach?
Base Soars to $500M TVL: Armstrong Reveals Plans
In an exclusive interview with Decrypt, Brian Armstrong, the CEO of Coinbase, praised Base’s rapid growth, reaching $500 million in total value locked (TVL) within months, becoming the third-largest layer-2 network.
Armstrong emphasized efforts to integrate Base with various applications and make it interoperable within the crypto community. The goal is to ensure stability and trust while expanding beyond Coinbase’s influence.
"We're not planning to create any token for Base," Armstrong stated. "Now, we're doing the hard work to integrate it with various applications," he added.
Coinbase Aims for Faster, Cheaper Transactions
The company aims to achieve faster and cheaper transactions, aiming for under one second and one cent on average. Coinbase plans to prioritize layer-2 usage to make this a reality, envisioning a substantial shift from occasional to routine utilization.
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"That will require improvements to Base," Armstrong acknowledged, "but it will also mean making layer-2 the default on our platform; not something people occasionally do, where they bridge to layer-2 and do something."
Armstrong highlighted the importance of transitioning to layer-2 networks, comparing it to the internet’s move from dial-up to broadband. He urged industry consolidation around a select few layer-2 networks for efficiency. Acknowledging the industry-wide interest in layer-2 networks, Armstrong stressed the need for broader adoption to drive the industry forward.
On the Flipside
- Coinbase’s choice to avoid introducing a token for its layer-2 network poses risks as it aims for it to be the primary transaction platform.
- Without a native token, potential failure or emergence of a superior option could leave Coinbase without a fallback plan.
Why This Matters
Brian Armstrong’s confirmation regarding Coinbase’s decision not to introduce a token for its layer-2 network, Base, underscores the platform’s commitment to enhancing the scalability and efficiency of transactions within the crypto space.
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To learn more about Coinbase’s record number of US government data requests in 2023, read here:
Coinbase Sees Record Number of US Govt Data Requests in 2023
To understand what Coinbase’s subpoena from CFTC means for you, read here:
Here’s What Coinbase’s Subpoena From the CFTC Means for You
