Coinbase

I know what you are thinking. Coinbase has been around for ages, but why are we covering it now?

We're highlighting it now due to recent hype surrounding the launch of Base, an Ethereum Layer 2 network.

In a previous article, we covered how Base Dominates Ethereum Layer-2 Fees.

In this article, we'll dive into what is Base and explore the most traded token on the Base network.

‍These are the assets we will cover in this article:
- About Coinbase (COIN)
- About Base Network
- Base Ecosystem
- Why is COIN The Coin of the Week?

‍About Coinbase (COIN)

What is Coinbase?

‍Coinbase Global, Inc., known as Coinbase, is a publicly traded American company operating a platform for cryptocurrency exchange. It functions as a distributed organization, with all employees working remotely. As the largest cryptocurrency exchange in the United States by trading volume, it was established in 2012 by Brian Armstrong and Fred Ehrsam.

Security

Coinbase employs strict security measures, including compulsory 2-factor authentication (2FA) and advanced techniques like cold storage and multiparty computation (MPC) to safeguard customer assets.

With MPC, cryptographic keys are generated for on-chain transactions, making it highly secure against potential attackers.

Coinbase Wallet

For users seeking an interactive platform, Coinbase offers a non-custodial wallet as an alternative to its website. However, users must ensure the safety of their login details to prevent permanent loss of assets.

This wallet also serves as an option in regions where Coinbase.com is inaccessible.

Advanced Trade

Advanced Trade, a native trading platform by Coinbase, caters to experienced traders by offering advanced tools, real-time order books, and enhanced security features.

It surpasses the previous advanced platform, Coinbase Pro, with more market pairs, TradingView integration, and improved staking rewards.

Native NFT Marketplace

Within the Coinbase exchange, users can access a native NFT marketplace to create, trade, or collect digital collectibles, providing a platform for NFT enthusiasts.

Base Network

Base Network facilitates easy integration of decentralized apps with Coinbase products and distribution channels.

It offers seamless Coinbase integrations, fiat onramps, and access to assets within the $130 billion Coinbase ecosystem.

‍Technical Analysis of COIN

‍From a long-term perspective, COIN has been overall bullish, trading within the rising wedge pattern marked in blue. Currently, COIN is undergoing a correction phase and is approaching a significant round number at $200.

As long as the $200 support level holds, we expect a continuation towards the upper bound of the wedge pattern and the $300 round number.

In parallel, if the $200 support is broken downward, we anticipate further bearish movement towards the lower bound of the wedge at $165.

‍About Base Network

What is Base?

‍Base is a secure, low-cost, builder-friendly Ethereum L2 built to bring the next billion users on-chain.

Powered by Optimism's OP Stack, Base stands out as one of the most secure and scalable EVM Layer 2 solutions available.

The OP Stack, an open-source resource, lays the groundwork for a network of interconnected Layer 2 solutions, promoting interoperability, sequencing, and governance.

Base boosts Ethereum's scalability, efficiency, and security through Layer 2 solutions, overcoming challenges present in Ethereum's primary layer.

‍Base Architecture

‍Ethereum L2 Integration

Base operates as a second-layer solution built on Ethereum's primary layer. It gathers transactions off-chain and then relays them to the Ethereum mainnet, reducing costs and increasing transaction capacity significantly.

Sequencer Functionality

Base includes a sequencer responsible for organizing and submitting transactions to Ethereum L1. While Coinbase initiates the sequencer, the goal is decentralization to enhance system resilience by reducing reliance on centralized entities.

Envisioning a Decentralized Ethereum Superchain

The Base ecosystem aims to construct a super chain comprising interconnected hubs, fostering seamless interaction among various L2 platforms. This approach enhances Ethereum's scalability by delegating specific tasks to specialized L2 platforms before finalizing them on the main Ethereum blockchain.

Operational Dynamics as an Optimistic Rollup

Base functions as an optimistic roll-up solution, presuming all transactions are valid unless proven otherwise. Approval from over two-thirds of validators is required for acceptance, promoting efficiency while maintaining security.

Fraud Prevention Mechanism

Base implements a fraud proof mechanism to verify transaction validity. If a user disputes a transaction, the sequencer must provide fraud proof to Ethereum L2 for validation before initiating a reversal process, ensuring transaction security for users.

‍Base Main Features

‍Enhanced Security

Base leverages Ethereum's robust security infrastructure, ensuring a safe and trustworthy investment environment.

Increased Scalability

Offering rapid transaction speeds and cost-effectiveness compared to Layer 1, Base provides extensive scalability for decentralized applications (dApps), catering to diverse sectors like decentralized finance (DeFi), gaming, and non-fungible tokens (NFTs).

Developer-Friendly

Base seamlessly integrates with the Ethereum Virtual Machine (EVM), facilitating easy transaction processing for dApps and offering straightforward APIs for account abstraction. Developers can easily migrate existing blockchain projects from Ethereum smart contracts to Base.

Access to Coinbase’s Ecosystem

Integration with Coinbase grants projects built on Base access to Coinbase's wide array of products, users, and tools. Users can utilize Coinbase's wallet to engage with Base's dApps.

Interoperability

Designed for easy connectivity with Ethereum's Layer 1 and other Layer 1 and Layer 2 solutions, Base enhances user experience and provides flexibility to expand project markets and user bases.

Economic Efficiency

Base ensures full EVM compatibility at lower costs (low gas fees), facilitating seamless transactions and cost-effective multichain application development. This economic efficiency, coupled with higher returns, makes the Base ecosystem appealing to investors.

‍Base Ecosystem

‍The base ecosystem has seen swift development, hosting more than 200 projects within its network in under a year since the mainnet launch.

Here are a few notable examples of trending projects within the base ecosystem:

‍Aerodrome Finance (AERO)

About AERO

‍Aerodrome Finance (AERO) is a next-generation Automated Market Maker (AMM) that aims to be the central liquidity hub on the Base blockchain.

It incorporates a powerful liquidity incentive engine, a vote-lock governance model, and a user-friendly experience.

AERO, the native token, plays a critical role within the ecosystem, facilitating governance, incentivizing liquidity provision, and rewarding participants.

‍Technical Analysis of AERO

‍AERO has been trading bullish overall, trading above the blue trendline, which is acting as a non-horizontal support.

As long as the $1.3 support level remains intact, we anticipate a continuation of the bullish trend.

For the bulls to regain control, and start the next impulse movement upward, a breakout above the last major high at $1.85, highlighted in red, is needed.

‍Axelar (AXL)

About AXL

‍Axelar is an infrastructure platform that provides interoperability to enable blockchains, assets and applications to interact with each other.

The main purpose of Axelar is to solve interoperability problems that arise due to the isolated nature of blockchains.

This platform provides interoperability solutions that can be used in decentralized finance (DeFi), gaming, digital asset management and many other industries.

‍Technical Analysis of AXL

‍AXL has been overall bearish trading within the falling channel marked in red.

However, it is currently rejecting a strong demand zone around $1.

As long as the $0.885 level holds, we will be looking for buy setups.

For the bulls to regain control, and start the next impulse movement upward, a breakout above the upper red trendline and the last major high at $1.35, highlighted in red, is needed.

‍SeamlessFi (SEAM)

About SEAM

‍SeamlessFi (SEAM) is a notable project within the Base ecosystem, distinguishing itself as a cutting-edge decentralized finance (DeFi) protocol focusing on lending and borrowing.

SEAM serves as the governance token of the Seamless Protocol, marking it as the first decentralized, native lending and borrowing protocol on Base.

Seamless Protocol's creation involved input from individuals with backgrounds in notable projects such as Aave, Coinbase, and Uniswap, among others, ensuring a strong foundation for its development and future growth​.

‍Technical Analysis of SEAM

‍SEAM has been overall bullish trading within the rising channel marked in blue.

Currently, it is in a correction phase, approaching the lower bound of the channel.

As long as the demand zone marked in green holds, we will be looking for buy setups.

For the bulls to regain control, a breakout above the last major high at $6.15, highlighted in red, is needed.

Meanwhile, SEAM would be bearish and can still trade lower to test the lower blue trendline.

‍Echelon Prime (PRIME)

About PRIME

‍Echelon Prime is a dynamic project within the Base ecosystem aimed at revolutionizing web3 gaming by providing a robust utility token, PRIME, for an array of games.

The token serves as the lifeblood of the Echelon ecosystem, facilitating token-gated products, services, and gaming experiences known as PRIME Sinks.

‍Technical Analysis of PRIME

‍PRIME has been overall bearish trading within the falling channel marked in blue.

However, it is currently approaching the lower bound of the channel and $15 support level, so we will be looking for buy setups on lower timeframes.

In parallel, for the bulls to take over again, a breakout above the previous major high, marked in red at $21.1, is needed.

‍Why is COIN The Coin of the Week?

‍In conclusion, the Base network commitment to interoperability, open-source principles, and a seamless user experience, supported by the infrastructure and partnerships, positions it as a key player in driving the next wave of blockchain innovation.

From a technical perspective, COIN is hovering around a strong round number of $200, providing us with a good opportunity to capitalize on the upcoming bullish impulse.

But It's not just about market trends; many projects have been developed on top of this unique network. Hence, it's essential to acknowledge the pivotal role that Base plays in expanding the Ethereum ecosystem. It provides a scalable, user-friendly platform for developing and deploying decentralized applications (DApps).

Thanks for tuning in to this week's coin of the week! We appreciate your readership and enthusiasm for exploring the crypto landscape with us.

See you next week for another coin of the week! 🚀