Base, the layer-2 network by Coinbase, could dominate the decentralized finance and consumer applications market starting in the second quarter, according to blockchain analytics firm Nansen.

Nansen’s latest report highlights on-chain activity, robust metrics, and a growing user base as some of the catalysts that signal a potential explosive performance for Base in Q2.

This suggests the L2’s continued rise as a core DeFi platform. Beyond leading the next generation of consumer applications, the tailwinds heading into the next quarter shine a spotlight on ecosystem projects and tokens, including the likes of Virtuals Protocol (VIRTUAL) and Aerodrome Finance (AERO).

Strong catalysts for Base in Q2, likely to push total value locked even higher include new app-chains, effect of the U.S. Securities and Exchange Commission dropping its lawsuit against Coinbase and the growing pro-crypto landscape. 

“Base is Coinbase’s direct bet on an onchain future and given the large network effects and scale of Coinbase, we see Base positioned strongly,” Nansen wrote in its report.

Combining these catalysts with strong on-chain traction across traditional metrics, such as TVL, stablecoin velocity, and daily active users, paints a bullish future for Base. These metrics reflect developer activity, roadmaps, and funding, forming part of a compelling narrative for Base’s growth.

Nansen analysts view this “State of the Chain” as what sets Base apart from other L2s.

Upcoming developments

Flashblocks, currently live on testnet and set for a mainnet launch in Q2, along with Base appchains and smart wallet sub-accounts scheduled for release in Q2, are notable developments that strengthen Base’s growth outlook.

While Base itself still has no native token, analysts see memecoins and artificial intelligence-linked tokens as some of the assets likely to offer directional exposure to the L2.

Projects such as VIRTUAL, AERO and others offer potentially great entry points given their current performances. The narratives to watch include DeFi meta, gaming, SocialFi and payments. Listing on Coinbase and expansion to Solana are also key ecosystem milestones. Bitcoin (BTC) performance is another.

“With BTC still trading in a range, we’re not in a rush to time altcoin trades, but positioning for a potential breakout remains key. If the momentum shifts, Base-native assets could outperform significantly,” the analysts opined.

The creator of Base, the blockchain of top US-based crypto exchange Coinbase, says that the company’s stock (COIN) could soon become available on-chain.

In a new thread on the social media platform X, Base developer Jesse Pollak says that eventually, every asset in the world will be on Base, including COIN.

However, Pollak notes that some traders can already access COIN on Base through asset tokenization protocol Backed.fi, adding that regulatory clarity would “unlock” it for everyone.

According to Pollak, Coinbase has not yet formulated concrete plans to bring over real-world assets to the blockchain, which launched in August 2023 as an Ethereum (ETH) layer-2 scaling solution.

“And to clarify even further: there are no concrete plans right now. We are in an exploratory phase and working to understand what needs to be unlocked from a regulatory perspective to bring assets like COIN to Base in a safe, compliant, future-looking way. Still day one.”

Looking at a longer arc of time, Pollak reiterates Base’s plans to see the blockchain as the backbone of global transactions.

“Base’s north star is to build a global economy, on-chain… We are going to bring $1 trillion+ assets to Base and it’s going to happen faster than anyone expects – still day one.”

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Jesse Pollak, the core builder of the Coinbase Exchang-backed Ethereum layer-2 network Base has hinted at the plans for the tokenization of the firm’s COIN stock available on the protocol. He shared this vision in a post on X where he said “every asset in the world will be on Base.”

The COIN Tokenization on Base

According to Jesse Pollak, integrating COIN on Base is something the layer-2 developers are currently looking into. Amid conversations with community members, Pollak confirmed that despite the new tilt, there are no concrete plans regarding this tokenization for now.

The Base developer said the team are in an exploratory phase for now. The goal here remains to understand what the team needs to unlock from a regulatory standpoint that will enable COIN tokenization on Base. Considering the fragile nature of regulations in the United States, Pollak said the goal remains to launch COIN on the protocol “in a safe, compliance and future looking way.”

Despite the reservations, he confirmed that users can already access COIN on other protocols like BackedFi. However, the accessbility to BackFi is limited to non-US citizen. It remains crucial to secure regulatory clearance in order to unlock the product for all users as an open source platform.

and to clarify even further: there are no concrete plans right now. we are in an exploratory phase and working to understand what needs to be unlocked from a regulatory perspective to bring assets like $COIN to @base in a safe, compliant, future looking way.

still day one.

— jesse.base.eth (@jessepollak) January 3, 2025

In all, Jesse Pollak reassured community members that it is still day one, implying there is room for more plan refinement. The COIN launch on Base might help solidify the protocol’s rank as the biggest L2 on Ethereum after recently outshining Arbitrum.

Tokenization of Real World Assets: Who’s Leading the Pack 

Tokenization is a growing trend in the digital currency ecosystem with firms like Franklin Templeton and BlackRock taking the lead. While Franklin Templeton is one of the pioneered on Wall Street, BlackRock’s BUIDL money fund has continued to stir major milestone.

These asset managers are expanding their tokenized funds to protocols like Base Network for more reach.

BlackRock has continued to expand since its introduction last year. Lately, Frax Finance said its DAO has approved BUIDL as frxUSD reserve asset. This marks one of the major protocol expansion reported in the past few months.

Besides these firms, Ripple Labs is also getting into the tokenization game. Specifically, it has a partnership with Archax with growing reliance on RLUSD stablecoin and XRP Ledger as innovations to help drive growth in this niche.

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Godfrey Benjamin

Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.

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