April 16, 2024 at 08:18 GMTModified date: April 16, 2024 at 08:18 GMT
April 16, 2024 at 08:18 GMT

Base leads Ethereum L2 race as Solana falters in congestion

Amid Solana’s congestion woes, Coinbase’s Base has emerged as a preferred alternative for traders and developers alike.

Base leads Ethereum L2 race as Solana falters in congestion

Coinbase-supported Base network surpassed Arbitrum as the leading layer-2 (L2) network by active addresses in April.

Data from growthepie has revealed that Base has seen a surge of over 1.48 million new active addresses in the first nine days of the month. In doing so, it narrowly edged out Arbitrum One, which recorded 1.43 million active addresses.

Other Ethereum scaling solutions like zkSync Era and the Optimism mainnet also made their mark, securing spots in the top four with 1.21 million and 650,000 active addresses, respectively.

However, Arbitrum One still holds a slight lead over Base in active addresses over the last 30 days, boasting 3.84 million compared to Base’s 3.76 million.

Despite the competitive landscape, Base recently hit a significant milestone by surpassing $4 billion in total value locked on the protocol earlier this month, trailing only Arbitrum One and OP Mainnet according to L2BEAT.

Moreover, Base stands out with the largest 30-day transaction count at 53.1 million, exceeding Arbitrum’s 41.2 million and Ethereum’s 37.9 million transactions over the same period.

The surge in Base’s active addresses can be attributed in part to the recent meme coin craze on the network.

However, Base’s popularity has also attracted scammers, with phishing scams on the rise, resulting in $3.35 million stolen last month.

While Coinbase launched Base last August and currently maintains full control over the chain, the firm has expressed its commitment to gradually decentralise it over time.

Meme coin frenzy

The meme coin market has exploded in recent times, with the total market capitalisation of these quirky digital assets surpassing a staggering $56 billion. 

This surge represents a nearly threefold increase since the start of the year, indicating a frenzy of activity among traders who are both making and losing fortunes in a matter of days.

According to IntoTheBlock’s Q1 2024 On-Chain report, demand for memecoins has soared to levels not seen since 2021. Surprisingly, this surge in demand has occurred despite the absence of government stimulus checks, which played a significant role in fueling the previous meme coin bull run during the COVID-19 pandemic.

Memecoins have taken centre stage in the cryptocurrency world in recent months, with tokens like $SHIB, $PEPE, and $FLOKI witnessing trading volumes surpassing even that of Bitcoin on major exchanges like WazirX. 

Notably, leading memecoins such as Dogecoin ($DOGE) have seen their prices double this year, while others like $SHIB have experienced gains of 2.5x and $PEPE a remarkable 5x.

Base blockchain has also witnessed a surge in memecoin activity, with the total value of cryptocurrency sent to Base surpassing $1.2 billion earlier this month. 

This surge in activity on Base can be attributed in part to the Dencun software upgrade on Ethereum in March, which significantly reduced trading costs on L2 blockchains like Base.

A significant uptick in daily transactions has been noted as well as traders flock to meme coins within Base ecosystem. Tokens like Degen ($DEGEN), Brett ($BRETT), All Your Base ($AYB), Based Shiba Inu ($BSHIB), and Broge ($BROGE) have recorded impressive weekly gains ranging from 30% to 200%.

According to data from DeFiLlama, Base has locked in $1.48 billion worth of cryptocurrencies, marking a new high. Daily transactions on Base surged to over 2.38 million, indicating a growing interest in meme coins within the network.

A preferred alternative

This surge in transactions coincides with a decline in trading volumes on Solana’s decentralised exchanges, suggesting a shift in capital towards layer-2 chains like Base.

NFT expert @punk9059 noted that the once-dominant NFT community is now exploring avenues such as meme coins and Bitcoin.

While Solana has been a popular choice for developers due to its speed and affordability, recent congestion issues are impacting its performance. 

Co-founder Anatoly Yakovenko aired frustrations about patching congestion-related bugs, while Helius Labs CEO Mert Mumtaz accused an unspecified infrastructure provider of exploiting Solana bugs for profit.

On the other hand, Base offers a scalable and efficient solution, providing a seamless experience for users seeking to avoid the congestion issues plaguing other networks.

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