1. Introduction

Launched by Coinbase, the Base chain has risen rapidly since its debut in August 2023, becoming the second-largest Layer 2 network and the fifth-largest blockchain network. In just one year, the Base chain has made significant progress in ecosystem development, developer activity, and capital market performance. Recently, driven by the popularity of AI Agents, the Base ecosystem has been performing impressively. Moreover, the transaction volume and user activity on the Base chain have seen explosive growth, and the ecosystem has expanded to include various fields such as NFT, social networking, and AI, showcasing diverse development.

This report will start with the background and development history of the Base chain, provide an in-depth analysis of its ecosystem performance and dynamics, highlight prominent projects, and discuss its future development prospects. By providing a comprehensive overview of the Base chain’s ecosystem and market performance, this report aims to present a complete picture of the Base ecosystem to readers.

2. Overview of the Base Chain’s Background and Features

As the Ethereum network gained widespread usage, issues of congestion and high transaction fees became increasingly prominent. To address these issues, Layer 2 scaling solutions emerged. In February 2022, Coinbase announced the launch of the Base chain, aiming to enhance the scalability and user experience of Ethereum using Layer 2 technology.

2.1 Development History

• February 2022: Coinbase announced the launch of the Base chain and established the Base Ecosystem Fund to support developers and projects within the ecosystem.
• February 2023: The Base testnet went live, allowing developers to explore its features and start building applications based on Base.
• August 2023: The Base mainnet was officially launched, transitioning from the testing phase to full operation, marking the start of large-scale application of its technology and ecosystem.
• January 2024: Base released its 2024 strategy and roadmap, positioning itself as a developer platform and application hub.

2.2 Technical Architecture: Deep Integration with Optimism

The Base chain opted for a partnership with Optimism during its technical planning phase, utilizing the OP Stack architecture. Upon mainnet launch, Base and Optimism announced a governance and revenue-sharing agreement, further solidifying their relationship. Key components include:

• Governance: Base and Optimism have formed a global Security Council responsible for upgrading and managing both networks, ensuring security and fairness through a multisignature governance mechanism.
• Revenue Sharing: Optimism will pay up to 118 million OP tokens to Base over six years, while Base will provide a perpetual revenue share to Optimism.

2.3 Strong Support from Coinbase

As one of the largest compliant exchanges globally, Coinbase provides significant market and technical backing to the Base chain:

• Compliance and Trust: Coinbase, trusted by the U.S. Securities and Exchange Commission (SEC), has strong regulatory compliance, providing a stable foundation for the long-term development of Base.
• Ecosystem Support: Coinbase offers comprehensive support to high-quality projects on the Base chain. For example, Aerodrome, a flagship liquidity protocol on Base, has received investment from Coinbase Ventures and was included in the Coinbase exchange’s listing roadmap.
• Market Influence: Leveraging Coinbase’s brand effect, Base has attracted numerous users and developers, quickly establishing a significant position in the Layer 2 space.

2.4 Features of the Base Chain

• Low Cost and High Efficiency: Base utilizes OP Stack technology to significantly reduce transaction fees and increase transaction throughput, providing a more economical transaction environment for users.
• EVM Compatibility: Base supports the Ethereum Virtual Machine (EVM), allowing developers to easily migrate Ethereum-based smart contracts and DApps, reducing development complexity and enhancing ecosystem interoperability.
• Scalability: As a Layer 2 solution, Base expands the blockchain network capacity using Rollup technology, providing a smooth user experience and broad application scenarios for developers.
• Coinbase’s Brand Endorsement: With Coinbase’s strong resources and influence, Base leads other competitors in terms of funding, technology, and market credibility.
• Open Source and Decentralization: Base adheres to an open-source and decentralized philosophy, allowing any developer to freely build and deploy applications, thereby promoting innovation within the ecosystem.
• Developer-Friendly Experience: Base offers a simple API design for easier deployment and management of smart contracts, supporting multi-chain interactions to facilitate cross-chain application development.

3. Base Ecosystem Performance and Dynamics

The Base ecosystem has demonstrated robust growth across several key metrics.

3.1 On-Chain Total Value Locked (TVL)

As of December 5, 2024, according to DefiLlama data, Base’s TVL has reached approximately $3.75 billion, a substantial increase from $440 million in January 2024. Base’s TVL is second only to Arbitrum, making it the second-largest Layer 2 network and the fifth-largest blockchain network.

Source：https://defillama.com/chains

3.2 On-Chain Transactions and User Activity

The number of daily transactions and active users on the Base chain has shown a continuous growth trend. Notably, in mid-2024, transaction volume and user numbers saw significant acceleration. As of December 5, 2024, the 7-day average transaction volume on the Base chain reached 8 million, with 1 million active addresses, setting new records.

Source：https://dune.com/sixdegree/base-blockchain-overview

3.3 Diverse Ecosystem

Base supports various types of decentralized applications (dApps). Currently, its ecosystem includes 323 dApps, with DeFi being a significant focus, but rapid growth also being seen in fields such as NFT, social networking, and AI, showcasing diversity and innovation.

Source：https://www.base.org/ecosystem?utm_source=dotorg&utm_medium=nav

4. Prominent Projects in the Base Ecosystem

The Base ecosystem spans multiple fields, exhibiting diversity and innovation. Key project types include meme culture, artificial intelligence, decentralized exchanges (DEXs), and lending platforms.

4.1 Meme Tokens

• BRETT: Inspired by the “Boy’s Club” comic series by Matt Furie, BRETT quickly attracted numerous investors and users since its 2023 launch. Its market cap has surpassed $2 billion, making it one of the most influential meme tokens on Base.
• DEGEN: Closely integrated with the Farcaster platform, DEGEN provides users with a novel interaction method, allowing tipping on social platforms, enhancing user recognition and frequency of use. DEGEN’s market cap is currently around $300 million.

4.2 Artificial Intelligence (AI)

• VIRTUAL: The native token of the Virtuals Protocol platform, which allows users to create and manage their AI agents. Users activate AI agent functions by consuming VIRTUAL tokens, which have a current market cap of $1.7 billion.
• LUNA: A flagship AI agent launched by Virtuals Protocol, designed to interact with users via a virtual persona (Vtuber). LUNA can livestream on platforms like YouTube and interact with fans in real-time.
• CLANKER: A platform based on the Farcaster social network, simplifying the token creation process, enabling users to deploy their AI agent tokens effortlessly. CLANKER creates real income for the community through a 40% revenue-sharing mechanism while encouraging more users to participate in the token economy.

来源：https://app.virtuals.io/

4.3 Decentralized Exchanges (DEXs)

• Aerodrome: Known for its innovative vAMM solution, the platform effectively addresses issues like liquidity provider (LP) impairment, reducing arbitrage losses by up to 40% compared to traditional AMMs. Aerodrome’s TVL is $1.1 billion, making it a key player in the Base ecosystem.
• AlienBaseDEX: By integrating all functions into a seamless interface through the Epsilon system, this DEX enhances user experience and transaction efficiency. The ALB token’s current market cap is $4.65 million.

4.4 Lending Projects

• Moonwell: The platform has significantly improved trading efficiency, growing by 80 times this year, making it a key choice for lending users. The WELL token’s market cap is currently $220 million.
• Morpho: Supported by a16z and Coinbase Ventures, this project combines the efficiency of order books with the flexibility of DeFi. Its deposits have surpassed those of Compound, showing strong market competitiveness. The MORPHO token’s market cap is currently $200 million.

Source：https://defillama.com/chain/Base

5. Prospects and Summary of the Base Ecosystem

From SocialFi to DeFi, and from AI to meme culture, the Base chain has demonstrated strong growth potential across multiple fields. As cross-chain liquidity and transaction volumes continue to grow, Base is well-positioned to challenge Solana and Ethereum as a leading Layer 2 ecosystem.

• Technical Innovation: Base, built on Optimism’s OP Stack, is expected to further enhance network performance and security through future technological upgrades. These advancements will provide a better experience for developers and users, improving transaction efficiency and security.
• Ecosystem Expansion: As more DeFi, NFT, social, and AI projects join, the Base ecosystem will become richer and more diverse, attracting more users and capital, thus forming a positive growth cycle.
• Community Building: Base actively promotes community development by organizing hackathons and developer conferences, encouraging developers and users to participate in ecosystem growth. This community vitality not only attracts new developers and projects but also fosters more active participation from existing users, enhancing the overall ecosystem cohesion.
• Regulatory Environment: As a Layer 2 network launched by Coinbase, Base has advantages in compliance. With changes in the global blockchain regulatory landscape, Base is likely to gain more institutional and user recognition for its compliance and security, further promoting ecosystem growth.

In summary, backed by Coinbase, Base has strong support for its ecosystem development. Coinbase not only provides Base with a large user base but also enhances market credibility through its resources and reputation. In addition, Base actively engages in interoperability with other blockchains to consolidate its leadership in the Layer 2 market. Despite facing fierce competition from other Layer 2 solutions such as Arbitrum and Optimism, Base maintains strong growth momentum due to its low costs, high speed, and developer-friendly tools. As fields like DeFi, AI, and SocialFi continue to expand, the Base ecosystem is expected to thrive and set a new standard for Layer 2 scaling solutions.

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