Coinbase Network Challenges Solana With Rapid Adoption

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Key facts: Solana has been one of the featured networks so far in 2024, but that could change. The growth of Base will be beneficial for the cryptocurrency ether (ETH). Base bursts into the cryptocurrency landscape as an alternative to Solana, positioning itself as a second-layer scalability solution for Ethereum. Developed by popular cryptocurrency exchange Coinbase, Base has seen accelerated growth, posing a challenge to the hitherto dominant Solana network. This is because in Both networks have developed an efficient environment for projects that have things in common. Solana has been one of the top networks so far in 2024, thanks to its fast transaction speeds and low fees. Although Base has been closing distances with Solana, the latter continues to lead in several aspects such as total value locked (TVL), active addresses and daily transactions. Solana began 2024 with a TVL of $1.5 billion, figure that has increased by 193%currently reaching $4.4 billion, as seen in the following DeFiLlama graph.

Solana TVL. Source: DeFiLlama. For its part, Base has a TVL of 1.6 billion dollars. This has increased especially so far this year, going from 444 million dollars in January to 1,796 million dollars currently, its highest TVL reached since its launch. As seen in the following graph from the Artemis analysis platform, in the daily active addresses of both networks There is also a considerable difference.

Daily active directions between Solana and Base. Source: Artemis. Solana, until yesterday, June 11, registered 1.6 million active addresses, while Base reached 607,000 addresses. Something similar happens with daily transactions, since in Solana they reach 33 million, while Base registers 2.9 million, says Artemis.

Base gains ground on decentralized exchanges

It must be taken into account that Base was only launched in August 2023, that is, it has not been operating for a year, which is indicative of the rapid adoption that the network has had in a short time. Within it there are more than 100 applications and service providers available. Despite these data that may not be so encouraging, the arrival of Base could change the game, offering a similar solution in terms of performance, but with the advantage of being integrated into the Ethereum ecosystem. Base's growth not only benefits the network itself, but it also has the potential to boost the price of the cryptocurrency ether (ETH). This is because Base does not have its own cryptocurrency, but rather uses ETH as its native currency to pay commissions. It's like a kind of «cheaper Ethereum.» In fact, Base was the most used network on the decentralized exchanges Uniswap and Aave, as reported by Base creator Jesse Pollak. Regarding payments with stablecoins, these are also growing rapidly on the network.

Using Base on the Aave decentralized exchange. Source: Jesse Pollak. Base's rapid growth is due to several factors. Firstly, its integration with Coinbase makes access easier for users, as they can use their existing accounts to participate in the network. Additionally, the network offers attractive incentives for users who stake and validate transactions.

Solana and Base face each other in the memecoin war

Another factor that has driven Participation in both networks is related to the rise that meme cryptocurrencies have had this year. Solana stood out for closing last May with the largest number of new tokens on a monthly basis in the history of cryptocurrency networks, among which the majority are memecoins, BitcoinDynamic reported. They launched 455,000 tokens in Solana in May. In comparison, the closest monthly amount was precisely recorded by Base this year with around 250,000 tokens. Among the memecoins within the Solana ecosystem, dogewithhat (WIF) stands out, followed by Bonk (BONK) and Book of Meme (BOME), according to data from CoinGecko. The creator of Base, Jesse Pollak, believes that memes will be key to incorporating millions of users into the network. Pollak expressed his belief in the importance of memecoins within the cryptocurrency ecosystem. Memecoins are cryptocurrencies that arise from memes or jokes on the internet, and are often characterized by their volatility and speculation. However, Pollak argues that these currencies can play a significant role in the “on-chain economy”, that is, the economy that develops on cryptocurrency networks. The fastest growing meme cryptocurrency on Base is BRETT, in the last month it increased by 373%. This is followed by Degen (DEGEN) and Toshi (TOSHI).