As a seasoned analyst with over two decades of experience in the crypto industry, I’ve witnessed the growth of various blockchain networks from their infancy to becoming titans of the digital economy. The Ethereum network’s evolution into a Web3 powerhouse is nothing short of impressive, especially considering its decentralized financial (DeFi) protocols and stablecoins market cap.
The Ethereum network has expanded significantly into a significant area of Web3, boasting a total value locked (TVL) by its decentralized financial (DeFi) systems amounting to over $44 billion and a stablecoins market capitalization surpassing $80 billion. The principal developers of Ethereum, headed by co-founder Vitalik Buterin, have long championed layer two scaling options as a means to alleviate network congestion and promote both scalability that is sustainable and a secure environment.
Consequently, an increasing number of Web3 developers have been focusing their efforts on addressing Ethereum’s scalability issues primarily by employing zero-knowledge (ZK) technology. Notably, Uniswap Labs, the leading on-chain marketplace on the Ethereum network that also supports other blockchains, recently announced the debut of its layer two network called Unichain. This includes cross-chain compatibility and a decentralized validator network.
Base Network Emerges as Top Performing Ethereum’s L2
With an increasing number of institutional investors backing Ether ETFs, it’s clear that Ethereum’s L2 scaling solutions are gaining traction. Even though Ethereum’s income from transactions has decreased due to more transactions being handled on L2s, the long-term future for ETH looks promising.
As a researcher delving into the realm of Layer 2 solutions on the Ethereum blockchain, I’ve found myself consistently drawn to the project that stands out amongst the crowd – one backed by the global powerhouse, Coinbase Inc (NASDAQ: COIN), within the base network.
Based on the most recent market information, the Total Value Locked (TVL) in Base Network stands approximately at $2.47 billion, while its stablecoins supply is roughly $3.77 billion. Notable DeFi protocols making use of the Base network, and contributing to its performance, include Aerodrome DEX, Uniswap (UNI) DEX, Aave V3 Lending, Extra Finance, Morpho Blue, and others.
Impressively, the Base network boasts over 1.3 million daily active addresses and trades approximately $1 billion in value each day. In the last 24 hours, it has earned around $136k through transaction fees, demonstrating its economic viability for web3 users.
In simpler terms, the Base network has surpassed other scaling solutions on Ethereum’s layer 2, such as Arbitrum (ARB), Optimism (OP), and Polygon (POL), among others, in terms of performance. However, as per the current data, the Arbitrum network is nearly on par with the Base network, holding approximately $2.39 billion in total value locked and a stablecoin market capitalization of around $4.47 billion.
Over the last day, approximately 543 thousand unique wallets were actively using the Arbitrum network, with a trading volume amounting to around $679 million.
Direct Market Impact
In the future, the significant expansion of the Base network is expected to significantly boost Coinbase’s earnings. Furthermore, users can effortlessly access the Ethereum network via the Coinbase platform at a reduced price and with enhanced security assurances.
Currently, the price of ARB is showing signs of possibly reversing its downward trend that started in March. This mid-cap altcoin, valued at approximately $5.6 billion when fully diluted and traded about $398 million daily, appears to be forming a triple bottom pattern. Moreover, there’s an increasing divergence in the weekly Relative Strength Index (RSI), which could suggest a change in its trend direction.
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2024-10-15 19:30