ON–180: Base Mega Issue 🔵 💥
Coverage on Coinbase's new L2.
About the editor: Spencer Noon is an independent crypto investor.
EXCLUSIVE ONCHAIN COVERAGE:
👥 Lewis Harland | Website | Dashboard
📈 Base deploys 5x new contracts than Arbitrum daily
Base is a brand new Ethereum Layer 2 blockchain built on top of the OP Stack by Coinbase. Base mainnet opened for builders on July 13th and launched to the public on August 9th. Since then, Base is consistently seeing >10k contracts deployed daily which are multiples of contracts deployed on alternative L2s such as Arbitrum and Optimism.
Looking at the growth of app interactions beyond contracts deployed, Base is already seeing a comparable number of addresses performing app interactions daily to Optimism and Arbitrum in just over one month at ~80k/daily.
Base also operates with a positive fee margin whereby batch submitter costs to Ethereum mainnet are offset by L2 fees. Base achieved an 85% daily fee margin at its peak but has since fallen more in line with longer-operating Optimism and Arbitrum chains (at ~20%).
💦🔬 Tx-Level Alpha: Base looked to bootstrap activity once mainnet went live by launching an "Onchain Summer" campaign. This aimed at attracting users to the network by featuring daily NFT showcases of on-chain art, gaming, and music.
More than 160k wallets have already bridged assets over the Base and claimed the "Bridge to Base" NFT campaign since its launch.
② Bridging to Base 🌉
📈 Over $232M bridged bridged, 739k total active users
The surge in Base’s total value bridged (TVB) began with the launch of $BALD, the first meme coin on Base, on 30th July. User began depositing into Base ($53M on 30th July), leading to a dramatic increase in TVB and new users. But, the excitement quickly turned to disappointment when $BALD rugged the following day, resulting in a sudden drop drop in bridge net-flows.
After $BALD, the bridging activity was low until until August 3rd when Base launched a frontend for their bridge. Since then, Base experienced a rapid increase in TVB, from $89M to $232M+ at the moment. Moreover, ETH is still the major asset with $147.5M and accounted for 65.5% of TVB, followed by USDC with $59.39M and 25.5%, respectively.
Along with the TVB, the number of users going to Base also rose quickly since that time and hit 739.2k users at the current time, with approximately 20k new users daily. Furthermore, there are around 80k users staying active on Base and conducting over 390k transactions day by day.
③ NFTs on Base 🖼️
📈 In 1 month 523.7k wallets minted 38.9M+ NFTs on Base
From July 14th to early August, 523.7k wallets minted ~38.9M NFTs on Base. Early minting was dominated by a few thousand mints a day focused on Base's Builders NFTs. As of August, there's been a significant uptrend in daily NFT mintage, surging from mere thousands to 100,000-150,000 NFT mintages daily on the Base blockchain.
Since Base's inception, there has been a steady rise in NFT contract deployments. To date, 3.57k contracts have minted NFTs on base. Daily additions of new NFT contracts have consistently increased, now exceeding 190 new contracts daily.
Secondary NFT sales on Base account for 7.6k transactions, totaling 251 ETH. For NFT marketplaces, OpenSea leads with 6.7k sales, representing 246 ETH. Coinbase's NFT marketplace lags, with 993 sales yielding 5 ETH. Notably, secondary sales activity on Base's L2 chain don’t mirror the robust minting activity.
💦🔬 Tx-Level Alpha: The transfer of the "Base is for Builders" NFT resonated deeply with the Base community. The NFT represents the builder enthusiasm for Base, and has amassed nearly 100,000 holders, marking its meteoric rise in the blockchain community.
④ Alien Base 👽
👥 Alien Waifu | Website | Dashboard
📈 Alien Base gains $21.8 million TVL in one week as the fastest growing DEX on Base
Alien Base is a DEX based on the Uniswap V2 AMM design. After launching on August 9 with just a few thousands dollars of liquidity, it has rapidly gained the 2nd spot by TVL overall ($21.8M). The rise has been fueled by high yields and a key partnership with yield aggregator Beefy, which has listed most Alien Base pairs including native farms. The platform has since also added Overnight Finance vaults for USD+ and DAI+.
The TVL distribution includes $6.8M in cbETH/ETH $6.4M in ETH/USDC, and $5.7M in stable/stable pairs such as axlUSDC and USD+/USDC.
On its own token ALB, Alien Base’s pools consistently saw utilization rates of between 100-200%, reaching highs of $2M volume amid an average liquidity of between $500K-$1M. But for ETH/USDC, traders preferred V3 exchanges such as Uniswap, which boasted an average $4M volume per day compared to Alien Base's $500K.
💦🔬 Tx-Level Alpha: Avoiding Snipers. Many projects get “sniped” when they launch, where bots buy a large percentage of the supply to dump it later. After Alien Base adding liquidity on block 2371097, it took a surprisingly numerous 4 blocks before the pools saw sniper activity. Though this is just 8 seconds, 4 blocks are an eternity in MEV time. The transactions came from different accounts, but it is likely that it was one bot spamming transactions with multiple keys. Alien Base initialized the pools with very few tokens (51,000 or 0.01% of total supply) to lure snipers in. Unfortunately, after the token was “launched,” it was impractical to place the rest in pools due to concerns of current holders.
⑤ BasePaint 🖌️
📈 8.8k NFTs Minted and 2.8k unique wallets, 600 Artists Engage in First 7 Days
BasePaint is an art project where artists collaborate on a shared pixel-art canvas. Every 24 hours, the canvas is minted into an open-edition NFT. The distribution model is straightforward: artists are paid from the Open Edition mint based on the number of pixels they painted. Since its launch on August 9th, BasePaint has paid out 19.3 ETH to contributing artists. 2.8k unique active wallets have interacted with the BasePaint Contracts, making it the 11th most popular dApp on Base.
8 collaborative canvases have been painted, with a total of 8k NFTs minted as of Thursday, raising a median of 0.82 ETH split between the participating artists.
In order to contribute art to the canvas, every contributor must mint an NFT Paintbrush. 1 NFT Paintbrush is available for mint every 15 minutes. 650+ paintbrushes have been minted since launch.
💦🔬 Tx-Level Alpha: A notable transaction on BasePaint was the top artist payout, which stood at 1.5953 ETH. This significant disbursement highlights the potential earnings for artists who actively engage and contribute to the shared canvas.
⑥ friend.tech 👯
📈 Friends trade 9.3k ETH in Week 1 of friend.tech
friend.tech is "the marketplace for your friends," which launched on Base on Aug 10th. friend.tech users can buy "shares" of their friends to get access to a private "group chat" with that friend. Friends can send 1-to-many messages in their chat to all of their holders, but holders' messages are 1-1 to the chat owner. As of morning Aug 18th (~8 days after launch), friends made 390k transactions for 9.3k ETH in total volume; however, 50% of this volume came on Aug 11th, its second day live.
friend.tech's contract made up 8.8% of all "app transactions" (excludes token approvals, transfers, system transactions) on Base is the last week. Among currently mapped contracts, this leads popular apps such as Uniswap (DEX) and Zora (NFT Marketplace), and only trails thirdweb (development platform).
friend.tech's mobile site provisioned new user wallets using Privy (Twitter authentication). So far net 2.58k ETH has flowed in to these wallets, which was 1.95% of all ETH on Base (per L2Beat's tracking). Similar to transaction and trade volume, ~47% of inflows came on Aug 11th.
💦🔬 Tx-Level Alpha: The largest observed purchase on friend.tech was a ~9.34 ETH buy for 10 shares of ben.eth (currently the 3rd most expensive friend). Observing transaction logs, we can see that ~8.49 ETH went to the friend.tech contract, ~0.42 ETH (4.5%) went towards protocol fees, and another ~0.42 ETH (4.5%) went to the subject (ben.eth) in trading fees. In total, friend.tech has generated ~389 ETH in protocol fees from trading since their launch last week.
⭐ Bonus Coverage: ETPs
👥 Marco Manoppo | Website | Dashboard
📈 AUM of Select Crypto ETPs Grew by 43.6% To $8.92b
Exchange Traded Products (ETPs) are investment funds that are listed for trading on a national securities exchange and can be bought and sold in the equity trading markets. Shares in an ETP represent an interest in a portfolio of securities. Select crypto ETPs grew year-over-year despite the ongoing crypto bear market. AUM of crypto ETPs increased 43.6% over the last year—from $6.21B to $8.92B—as the number of products increased from 110 to 151.
Grayscale, which has over $20B in AUM, has seen a significant recovery in its Grayscale Bitcoin Trust (GBTC) and Grayscale Ethereum Trust (ETHE) products. Both products saw their discount to Net Asset Value (NAV) (percentage by which the product’s price is below the value of its assets) reduced by approximately 15% over the last year.
BlackRock’s entrance in the spot Bitcoin ETF race sparked activity across the crypto product landscape. Since then, there have been 7 re-filings of Bitcoin ETF applications. The next deadline for the SEC to take action on BlackRock's application is September 2, 2023. There’s also a possibility of a Grayscale case ruling that might change the dynamics of the spot Bitcoin ETF race in the U.S.
Quick Links: Disclosures
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