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Proposals to develop on Coinbase “Base”
Community members of crypto asset (virtual currency) decentralized exchange GMX have proposed to deploy GMX on Ethereum’s (ETH) proprietary Layer 2 (L2) network “Base” promoted by US Coinbase.
The proposal was originally posted by Relied on the GMX Governance Forum at the end of February following Coinbase’s “Base” announcement. Currently, it is being supported by multiple members.
GMX is known as a derivatives exchange on Ethereum’s layer 2 “Arbitrum”, and it was launched on the Avalanche Blockchain in February 2022 and is increasing its market share.
According to decentralized finance (DeFi) data site Defillama, total deposits (TVL) exceeded approximately ¥39.8 billion ($300 million) in March 2022 and has now grown to approximately ¥78.2 billion (approximately $590 million). ing. It has the largest TVL on Avalanche.
Proposer Relied points out that Coinbase’s launch of its own L2 is expected to bring a large inflow of funds into the ecosystem. He also mentioned the possibility of receiving support from the “Base Ecosystem Fund,” which invests in and supports early-stage projects based on Base.
“The benefits of early entry are huge,” relied continued.
We believe that the fact that “Base” is deeply integrated into the coinbase ecosystem, including the coinbase wallet, will be beneficial in promoting the inflow of funds into GMX’s own token GLP and the use of the GMX leveraged trading platform. be done.
As of now, much of the GMX community supports this proposal. There was also an opinion that there would be demand from users if GMX offered derivatives trading on Base. Others say the GMX v2 (version 2) release should now be the priority.
What is layer 2
A “second layer” blockchain. Writing all transaction histories to the main chain increases the load, slowing down processing speeds and increasing network fees. Therefore, by writing part of the transaction history in the off-chain or side-chain, it is possible to reduce the load on the main chain and improve the processing speed.
Cryptocurrency Glossary
What is Coinbase’s L2 “Base”?
US cryptocurrency exchange Coinbase announced its own L2 network “Base” in February. Aiming to provide a secure, inexpensive, and developer-friendly network, he said he hopes to eventually attract more than 1 billion users and make it the foundation of Coinbase’s products.
Utilizing the technology of “Optimism” that operates with a rollup mechanism, it aims to be a foundation for developing highly scalable dApps while using the security of Ethereum.
connection: US Coinbase to launch Ethereum’s own L2 network “Base”
What is rollup
A scaling solution that reduces network congestion by processing some transactions off-chain (outside the blockchain) while leveraging the security of the main blockchain.
Cryptocurrency Glossary
Coinbase envisions Base not as an isolated system, but as a bridge that connects Ethereum L1, other L2, and other L1 ecosystems such as Bitcoin (BTC), Solana (SOL), and Cosmos (ATOM). ing.
We also plan to decentralize the Base project in the future, and Coinbase will work with OP Labs, which contributes to the Optimism protocol, and Optimism Collective, the Optimism community.
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