Base — Layer 2 solution for scaling Ethereum
In 2017, the team of the leading altcoin on the crypto market did not have a solution for scaling the Ethereum network. However, other developers found a way to create decentralized networks on top of the Ethereum blockchain.
These networks collected user transactions into so-called "packets" and then validated them on the leading Ethereum network as if they were one whole transaction. This is how Layer-2 solutions or L2 networks came to be, and one of the key players in this arena is Base.
What is Base?
Base is a Layer-2 network designed to scale the Ethereum blockchain platform. In addition to this goal, the L2 network is designed to reduce transaction fees, improve user interaction with the blockchain ecosystem, and improve developer interaction with decentralized applications (DApps).
Base's L2 solution was developed by Coinbase, which owns one of the largest crypto exchanges on the market. According to CoinMarketCap, its daily trading volumes exceed $5 billion.
Base's leading network was launched in August 2023 and quickly started gaining popularity as one of the most well-known companies in the crypto industry is behind its launch.
According to monitoring service DeFi Llama, Base is the largest Layer 2 network to scale Ethereum in the decentralized finance segment and ranks among the top 10 blockchains in terms of total blockchain value (TVL), which exceeds $2.9 billion.
How does Base work?
Base's L2 solution is fully compatible with the Ethereum Virtual Machine (EVM) and customized for developers to make it easy for them to create and run DApps.
The Coinbase team created an efficient solution to scale Ethereum: Base's L2 network commissions cost less than a cent, and transactions are completed in less than a second. At the same time, the Base solution maintains the same level of decentralization and security as the Ethereum base network.
Base has thus become one of the most productive platforms for running DeFi protocols, including decentralized exchanges for trading digital assets and NFT marketplaces for buying and selling non-mutualizable tokens.
Like other Layer 2 solutions such as OP Mainnet, Polygon, and Arbitrum, Base's L2 network processes transactions outside of the Ethereum blockchain, thereby reducing the load on the Ethereum blockchain. Like OP Mainnet, Base's L2 network is designed based on Optimistic Rollups, which enables significantly faster transaction processing through "pre-confirmation." To efficiently manage large numbers of transactions, Base uses the OP Stack mechanism, also developed by the Optimism team.
Base processes all transactions at the second level and collects them into rollup packets. These packets are then sent for validation by validators directly on the Ethereum Base network.
As of February 2025, Base's L2 network does not have its native token and uses Ethereum cryptocurrency (ETH) as the primary asset for transaction fees.
Conclusion
In less than two years of existence, Base's L2 solution has managed to break into the leaders of its segment and gain a foothold there. For comparison, the TVL of the Base network exceeds the same indicator of its nearest competitor, Arbitrum, by $300 mln.
At the same time, Base's second-tier solution is slightly inferior to the leading blockchain platforms in the segment in terms of DeFi-ecosystem development, and some of them are even superior. For example, Base surpasses Solana, Tron, and Avalanche blockchains in terms of the number of decentralized applications launched on its platform.
Given the support of one of the leading crypto exchanges, Coinbase, whose reserves amount to billions of dollars, Base has every chance to remain the leading Layer-2 platform in the segment.