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It has been a busy week since Coinbase introduced its new layer-2 network, Base, to the public, resulting in a surge of activity from regular crypto users, prominent brands, and, regrettably, some malicious actors as well.
Coinbase’s Onchain Summer festival—a three-week initiative celebrating the launch of Base—has seemingly drawn a significant number of new users to the ecosystem.
As of August 16, over 700,000 new users have registered on the Base network, having bridged a total of $242 million to the platform, according to data from Dune Analytics. The chain experienced its highest activity on August 10, with more than 136,000 daily active users.
Total number of daily active users on Base. Source: Dune Analytics
Overall, the surge of activity on the network has generated an impressive $2.8 million in fees and has seen the total value locked (TVL) rise to $170.5 million, according to data from DeFiLlama.
The network also announced participation from one of the largest soft drink brands globally, Coca-Cola, which launched its own non-fungible token (NFT) collection on the network.
ᴏɴᴄʜᴀɪɴ ꜱᴜᴍᴍᴇʀ@CocaCola is bringing their Global Masterpiece campaign onchain with iconic works from leading artists.
Mint now: https://t.co/xTWyI3O7IW pic.twitter.com/9wxFgt8qOh— Coinbase ️ (@coinbase) August 13, 2023
Crypto-native organizations are also joining the network. On August 16, DeFi derivatives protocol Synthetix announced that a proposal for its deployment on the Base network had been unanimously approved by members of its governing DAO, the Spartan Council.
@BuildOnBase
SIP 336: Deploy Synthetix V3 on Base has been approved by the Spartan Council.
It’s only a matter of time. pic.twitter.com/CIEM0is69y— Synthetix ⚔️ (@synthetix_io) August 16, 2023
One of the most significant product launches on Base was the decentralized social (DeSo) network Friend.tech, which enables crypto users to tokenize their social connections by buying and selling “shares” of their friends. Since its launch on August 11, the social media platform has recorded approximately 7,736 Ether (ETH) in trading volume, according to data from Dune Analytics.
https://t.co/L11mNJZgY3 is built by @0xRacerAlt, a crypto OG.
He was the lead dev of @TweetDAO – an NFT which granted access to posting from a shared Twitter account.
The project went viral before devolving. It was one of the first forays into decentralized social media. pic.twitter.com/3wGo0aQ2Ip— yuga.eth (@yugacohler) August 11, 2023
Music NFT platform anotherblock launched on August 14, featuring exclusive on-chain releases from electronic music producers Boys Noize and Laidback Luke.
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Trust Wallet, a self-custody service owned by Binance, and enterprise-grade digital asset platform Fireblocks have also added support for the Base Network since its public launch.
Ethereum advocate Anthony Sassano expressed his support for the broader shift towards decentralized applications and on-chain activities, suggesting that centralized exchanges will eventually serve merely as fiat gateways.
That would be a silly lawsuit imo
If done right, Base can be a huge growth driver for Coinbase as it acts as the best “front door” for Base
My long-term thesis is that pretty much all CEXs will be relegated to just being fiat ramps – onchain will replace the other things— sassal.eth (@sassal0x) August 12, 2023
Bad actors find new base
Despite the overall enthusiasm from the crypto community, the launch of the network has also attracted the attention of malicious actors, resulting in several exploits and rug pulls since its public debut.
On August 14, one of the leading decentralized exchanges (DEX), RocketSwap, disclosed that it had experienced an exploit, with an estimated $865,000 stolen from the protocol.
The latest incident occurred on August 17 when crypto lender SwirlLend executed an “exit scam”—commonly referred to as a rug pull.
Update: SwirlLend rugged both on #Base and #Linea. The scammer has already bridged ~94 $ETH from #Linea to #Ethereum via Orbiter Finance: Bridge and and is currently in the process of transferring the stolen funds from #Base to #Ethereum
The current balance of the scammer’s… pic.twitter.com/zexiNuFVhs— PeckShieldAlert (@PeckShieldAlert) August 16, 2023
After erasing its social media accounts and removing its website, SwirlLend reportedly transferred approximately $290,000 worth of cryptocurrency from Base, along with an additional $1.7 million from Linea. It then laundered a total of 253.2 ETH through the Tornado Cash crypto mixer.
Related: Coinbase app is ‘broken’ for UX, admits CEO Brian Armstrong
However, bad actors have been targeting the network since its mainnet launch for developers. On July 31, a memecoin themed around Brian Armstrong, named “BALD,” lost 85% of its value after the developer abruptly withdrew $1.9 million in liquidity from the token’s pools. The developer has denied orchestrating a rug pull.
The following day, Base’s then-largest decentralized exchange (DEX) LeetSwap announced that some of its liquidity pools had been compromised, resulting in losses exceeding $600,000.
Deposit risk: What do crypto exchanges really do with your money?
