Uniswap is officially on BASE, Coinbase's optimisitic stack L2 for Ethereum. Early BASE users can take a sigh of relief knowing that they no longer have to trade on DEXs like Leetswap. Uniswap brings with it a level of trust and credibility that few other protocols have achieved in the DeFi space.
Why does Uniswap matter?
Before we dig into BASE, let's start with a brief background check on Uniswap and why this is so monumental for BASE.
According to DeFillama, Uniswap is the 4th largest dapp (decentralized application) in crypto by TVL, and the largest DEX (decentralized exchange) since Curve Finance had their little fiasco last week.
Uniswap has yet to deploy on Zksync Era, Linea, Pulsechain, or Polygon zkEVM, but BASE has already gotten the green light, just 1 month after its launch.
The list of chains that Uniswap is deployed on includes:
- Ethereum
- Arbitrum
- Optimism
- Polygon
- Celo
- BSC
- Avalanche
- BASE
Now, I'm putting my tinfoil hat on for a moment. Either it's just by chance that BASE got the early okay from Uniswap and low liquidity isn't why they haven't deployed on these other EVM chains, or, Uniswap is anticipating a lot more volume coming to BASE sometime soon. Hat off.
What is BASE chain?
So, you Uniswap wants a piece of the BASE pie. That much is clear, but what exactly is BASE?
BASE is an Ethereum L2 (layer 2) built by the Coinbase team. It is an optimisitic rollup chain, meaning it assumes that transactions posted to Etheruem are valid - but let's not get too lost in the weeds.
BASE was created using what is called the OP Stack. The OP Stack is a standardized, open source, development stack that powers Optimisim. It is maintained by the Optimism Collective.
L2s like BASE are created as a way to help scale Ethereum, by creating a low cost environement for users to transact on, as opposed to the main chain. L2s still get the security of Ethereum's main chain, but without the high costs
As they say in crypto, you should "abstain from CEX" whenever possible. Even Coinbase gets this, and it's only a matter of time before more of that message sets in with thei users. That's why Coinbase is hoping that BASE will be the starting point for users that make their way on-chain from centralized exchanges (CEX).
What this means for crypto?
First, there was an exchange. Then, they created their own Coinbase wallet. Now, there is BASE chain. Putting my tinfoil hat back on, me thinks that a protocol built by the Coinbase team may be coming next. We shall see. One thing is for sure though, CoinBase has slowly been gaining the trust of the American public. With BASE chain, they are creating perfect first destinatons for new crypto users that are ready to make their debut on-chain.
If history repeats itself, the early adopters of this chain could end up being some of the most rewarded users. Not just because of high APRs, with low liquidity, but also because of the potential of unofficial airdrops coming from new protocols that decide to deploy on BASE.
With Uniswap now deployed on BASE at least one of DeFi's hottest narratives has made its way to BASE chain - concentrated liquidity. Gone are the days of 50/50 LPs, concentrated liquidity is the new way of providing liquidity on-chain and it can be quite lucrative for users that are willing to actively manage their positions. Trading bluechip tokens, and using concentrated liquidity pools is a much better use case for the chain than just buying meme coins like BALD, a meme token that saw a parabolic climb before rugging its holders just days after the official launch of BASE chain.
Conclusion
For now, BASE claims that there will be no token for the blockchain, nor an airdrop to early users. Since it's an Ethereum L2 it uses ETH for gas, so another token would pressumably be strictly for governance purposes. Since Coinbase is centralized, they aren't to eager to give up all that power to a bunch of airdrop farming token holders. Not yet at least.
What's your take on BASE and Uniswap deploying on this new L2? Leave a comment with your thoughts as a reply to this post. Also, if you learned anything, please consider sharing this blog and discussing the topic with others.