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- 🐻 Could Coinbase bring DeFi mainstream?
🐻 Could Coinbase bring DeFi mainstream?
How Base could unlock DeFi for the masses
🐻
GM crypto friends. It’s been a relatively quiet week as the market dips back down slightly. What’s going on? Well, for one, the outlook for federal rate hikes doesn’t look good. We’re expecting the Feds to continue to hike the rates, bringing us to a recession…as if we’re not already there. I mean c’mon, even hackers are getting laid off 🤦. If that isn’t a bottom signal, I don’t know what is.
Recession is hitting hard
— Wall Street Memes (@wallstmemes)
4:19 PM • Feb 24, 2023
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In this issue:
📣The big story of the week. Coinbase brings DeFi mainstream with the launch of Base, an Ethereum L2 chain.
🚀The good. Spotify pilots a new token-gated playlist feature and Coinbase survey shows that a majority of people want a change in the financial system.
🐻The big, bad FUD. Solana experiences an outage, Drake loses $400k in Bitcoin and SBF made over 300 political donations illegally.
📣 The big story of the week
Coinbase brings DeFi mainstream with Base
As we all know, the past year has brought a lot of attention to centralized crypto companies and exchanges. While Binance suffers from a targeted FUD attack, Coinbase has somehow been dodging the negative limelight pretty well, other than some regulatory scares here and there.
In fact, the crypto community is suddenly bullish on Coinbase and how they could make up for what went wrong with CEXes 👀.
🚀 Coinbase branches out of CeFi
As the largest US crypto exchange, Coinbase has been actively expanding its products and services to move away from its dependency on its retail exchange. From launching a (failed) NFT marketplace to starting a venture fund to invest in DeFi projects, Coinbase is now entering into the competitive market of layer 2 (L2) blockchain networks.
1/ 🔵 We’re excited to announce @BuildOnBase.
Base is an Ethereum L2 that offers a secure, low-cost, developer-friendly way for anyone, anywhere, to build decentralized apps.
Our goal with Base is to make onchain the next online and onboard 1B+ users into the cryptoeconomy.
— Coinbase (@coinbase)
2:14 PM • Feb 23, 2023
Base is Coinbase’s latest venture out of CEX territory and is the first exchange to build its own L2 chain. What does that mean though? L2s are scaling solutions that run on top of base L1 blockchains, like Bitcoin or Ethereum. The purpose is to improve the scalability of the underlying network by increasing speed and reducing transaction fees and network congestion.
🔵 As for Base, it will run as an Ethereum L2 chain powered by Optimism and will be made for developers to build decentralized apps (dapps).
😄 That sounds optimistic
It does, but when I said “powered by Optimism”, I was literally referring to Optimism, another popular Ethereum L2 chain. This is important because Coinbase isn’t just building a standalone L2 chain, but has partnered with Optimism to build a superchain of networks 💪.
“The Superchain seeks to integrate otherwise siloed L2s into a single interoperable and composable system. We need to work towards a future where launching an L2 is as straightforward as deploying a smart contract to Ethereum is today.”
Optimism is currently building OP stack, a set of open-source modules to help create a standardized system for L2s. It will power L2 networks like Base and give access to each other’s dapps.
9/ The OP stack provides standardized, open-source modules for Layer 2 chains to provide shared security, composability and coordinated sequencing of transactions.
BASE being built into the OP stack opens up all applications built on Op-Chains to Coinbase's retail user base.
— Delphi Digital (@Delphi_Digital)
5:02 PM • Feb 24, 2023
Why is this bullish for crypto?
Coinbase has over 100 million registered users, and many have likely never truly interacted with dapps. With Coinbase’s simplicity, good UX and large mainstream userbase, this crypto giant could be the key to onboarding the next wave of dapp users, particularly for DeFi. Let the rush begin 🌊!
By leveraging the OP Stack, Coinbase's L2 called Base will work in a similar way to Optimism.
So why do we need another L2 network almost identical to Optimism?
The thing is that Coinbase has over 100M registered users, most of them being Americans.
— The DeFi Investor 🔎 (@TheDeFinvestor)
11:38 AM • Feb 24, 2023
With over $80 billion in AUM on Coinbase, Base will act as a bridge to bring normies on-chain and into the greater crypto ecosystem where self-custody and true decentralization lives 🙌.
"A bridge, not an island"
Coinbase all about that web3 ethos, quoting Solana btw
Very bullish on Coinbase, Base and the fact that they won’t issue any network tokens (another bullcase for ETH)
— WR☻NGUSER ✗ (@wronguserNFTs)
2:06 PM • Feb 23, 2023
While Base is still in the testnet phase, several popular projects have already committed to building on and supporting Base as a partner. If that’s not bullish, I don’t know what is 🔥.
Moving on, even if Base is now in the testnet phase, Coinbase has already partnered with numerous popular projects in the Ethereum ecosystem and beyond.
AAVE, Sushiswap, Balancer and Euler are well-known protocols that almost every DeFi native user has heard about.
— The DeFi Investor 🔎 (@TheDeFinvestor)
11:38 AM • Feb 24, 2023
With the mass destruction caused by CeFi companies last year, we’re excited to see how this could possibly help us move on from that 🚀!
🚀 The good
🎵 Spotify is piloting a new web3 feature called “token-enabled playlists” that allows NFT holders to connect their web3 wallets and listen to curated music.
🚀 New Coinbase survey shows that only 20% of Americans hold crypto, but a majority believe that the financial system needs a major overhaul. We’re only getting started.
🍓 (Video) School kids are using Bitcoin to buy fruits in Brazil.
🐻 The big, bad FUD
📉 A “forking event” on Solana slows transaction speeds and processing causing a major 24-hour outage.
🤦♀️ Rapper Drake loses $400,000 in Bitcoin for betting on Youtuber Jake Paul to win a boxing match.
💼 Dapper Labs cuts another 20% of its staff despite its supposed strong cash position.
🤔 SBF made over 300 political donations illegally as a straw donor, totalling to tens of millions of dollars.
👀Alpha web3 resources
💎 A thread on how to find your own crypto gems
📚 A web3 101 intro course by MetaMask
🔼 A Hacker News-like forum that pays you SATs
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