Blockchain has emerged as a game-changer in a world of constantly evolving technology.
And leading the way is Coinbase, a trailblazing company and an exchange titan. The latest
news from this innovative firm is the debut of its new Ethereum layer-2 network, Base. As
the name suggests, it might be the foundation for something incredible.
The exchange has announced the testnet of Base. Powered by Optimism, an alternative
leading Ethereum L2, the Base network promises to revolutionize the development of
decentralized applications (dApps) on the blockchain by offering a secure, low-cost, and
developer-friendly environment.
Interestingly, Coinbase has also unveiled a free open-edition Ethereum NFT titled “Base, Introduced” to commemorate this momentous milestone. Before diving deeper into the NFTs, let’s take a peek at the Base network.
What is Base, and why should you care?
Coinbase positions Base as a permissionless and open-source platform. On top of the brand name of Coinbase, Base is also an Optimism-powered, standardized, modular, rollup-agnostic Superchain. The exchange is also joining Optimism as a Core Dev on the open-source OP Stack, where they’ll help the company foster a flourishing community of developers.
Moreover, Coinbase has revealed that the Base network will be interoperable with other blockchains like Solana. Furthermore, the network would be decentralized, open-source, and based on the MIT-licensed OP Stack.
The announcement caused an immediate stir in the market, with investors reacting swiftly to the news. On February 23, following the unveiling of the new Ethereum layer-2 network, Coinbase’s stock soared by 5%. Not only that, but the price of OP also experienced a significant boost, leaving investors eager to capitalize on this promising opportunity.
Interestingly, the announcement’s impact was so profound that it even affected an unrelated token named Base. Initially, the token surged by a staggering 750% in response to the news, despite having no connection to the new blockchain. However, this surge was short-lived, and the token quickly gave up all of its gains as speculators likely realized their mistake.
Coinbase has no plans to create a token for its Basic cryptocurrency exchange because the company wants to avoid dealing with SEC, which might dispute whether or not the asset constitutes a security.
Optimism states that Base will contribute to the Optimism Community Fund with a portion of its transaction charge income. In addition, the partnership would collaborate on developing Optimism as a chain that links multiple chains into a unified network called Superchain.
For its part, the Superchain would unite different L2s into a single interoperable and composable structure. The long-term mission is to reach a point where deploying an L2 is as easy as deploying a smart contract to Ethereum.
The potential of the Superchain to enhance interoperability and foster a community for shared, decentralized protocols is a compelling prospect for the future. Undoubtedly, this is a partnership to keep an eye on.
Jesse Pollak, who serves as both the Coinbase Head of Protocol and the Lead for Base, states that “The thesis is that with Base, we’re going to enable millions of new applications that are really useful in crypto, which are going to bring billions of users on chain.”
Several DeFi projects have already expressed interest in adopting the Base network, drawn by the prospect of accessing Coinbase’s extensive user base.
However, amidst a flurry of activity in the L2 space, with mainnet flipping and upcoming solutions like Polygon’s zkEVMs and zkSync, the question remains: can Base carve out its niche? Time will tell.
We’ve scratched the surface of what Base has to offer, but now it’s time to dive deeper into its exciting NFT drop, “Base, Introduced.”
All about the ‘Base, Introduced’ NFT drop
To commemorate the momentous milestone of the Base testnet launch, Coinbase unveiled a free open-edition Ethereum NFT titled “Base, Introduced,” through the Zora NFT minting platform. Anyone can mint these until the window closes on March 5.
Since its announcement, the open-edition release has minted more than 411,111 NFTs, making the NFT smart contract the most goliath “gas guzzler” on the Ethereum network. With only one NFT allowed per wallet, the first three hours after its release saw over $271,000 in gas fees, highlighting this drop’s significant appeal and hype among the community.
Base also revealed that it would be “evolving the artwork” displayed on its NFTs daily for a week in a tweet on February 28. According to the tweet, Base aims to onboard “1B+ people onchain.” For some, the ‘Base, Introduced’ NFT will serve as an introduction to L2.
Moreover, the upcoming artworks will revolve around the theme of “the story of the builders,” who will play a crucial role in realizing Base’s mission of bringing 1B users on board.
The first metadata update or “evolution” took place on February 28 at 12:00 PM ET, and the artwork will be updated daily at the same time until March 6.
Controversies?
Although the original plan was for the Base NFT mint to last only three days, the announcement to extend it for an additional seven days caused a lot of displeasure among NFT enthusiasts on Twitter.
Besides, many users reported technical difficulties while minting, even though the exchange intended the memorial Base NFT to fractionalize the momentous time of Base L2 going live.
However, Coinbase claimed they extended the mint “to include builders at Ethereum Denver and to make sure as many people as possible can celebrate Base.”
It’s worth noting that while the minting price is free, the NFT enthusiasts still have to cover gas fees on Ethereum, typically around $10.
Another interesting fact is that Coinbase launched the NFT not on the Coinbase NFT marketplace but on a third-party platform, Zora. But you can still find some of these NFTs as secondary listings in Coinbase.
Coinbase’s recent foray into the NFT space is particularly noteworthy, considering that the exchange’s own marketplace has “paused” development to focus on other features. The native NFT marketplace has supported NFT mints, including major releases such as The Bill Murray 1,000 in the past.
Emilie Choi, Coinbase’s President and COO, has confirmed that the exchange is still committed to its NFT ambitions, despite having a “very lean team” working on its marketplace.
Nevertheless, the free Base NFT is a nod towards the recent “open edition meta,” where creators release low-cost NFT mints that then add in gaming elements, such as offering users rewards to “burn” (or forever destroy) a certain number of NFTs in exchange for a rarer variant that isn’t similar to the others.
Unpacking the Explosive Market Reaction
However, Coinbase has yet to make any promises about the Basic NFT’s potential utility or perks. The NFTs, however, are gaining traction in secondary marketplaces. Most sell for a low price of around 0.003 ETH ($5), but early versions or those with “vanity numbers” are fetching higher values.
For instance, someone bought NFT #888 tin the 4th week of February for 0.888 ETH (approximately $1,383) and has now listed it for 8.888 ETH ($13,930) in the hopes of making a tidy profit on the flip.
Since the free mint began, other three-digit NFT versions have gone for hundreds of dollars.
The collection’s astounding success is undeniable, with a staggering 626 ETH Volume on OpenSea and an additional 230 ETH on Coinbase NFT within days after launching.
Moreover, only 1% of the entire collection is available on OpenSea, and 77% of the owners are unique, another impressive feat.
On a side note, according to Base Discord FAQ, there are two commemorative NFTs anyone can mint to celebrate its launch. One is the previously discussed Zora’ Base, Introduced’ NFT, and the other is a BASEd x Optimistic NFT on Mirror.
BASEd x Optimistic NFTs were free-to-mint NFTs available for subscribers of Base’s Mirror newsletter celebrating the partnership between Base and Optimism. Unfortunately, the minting process has concluded, and people have minted 222,424 of these NFTs.
Conclusion
Coinbase made a significant impact by introducing Base, which not only has the potential to serve as a flagship blockchain but also provides a platform for developing on-chain products.
“We see the NFT marketplace as an experiment, we see Base as an experiment,” Jesse Pollak, who serves as both the Coinbase Head of Protocol and the Lead for Base, remarks. “While some of these experiments may succeed and others may not, it is crucial for us to take these risks in order to maintain our position as an innovative company.”
In addition, analysts have speculated that by leveraging Base and Coinbase wallet’s native swapping feature, the company could generate an estimated annual profit of approximately $0.7 billion (in a bear market) to $7 billion (in a bull market).
Overall, Base represents a brilliant strategic move by Coinbase, and ‘Base, Introduced’ NFTs are the icing on the cake. The possibilities are endless, which bodes well for Coinbase’s prospects moving forward.
