On Thursday, Coinbase made an announcement regarding its testnet launch of Base, a new Ethereum Layer 2 (L2) network that aims to offer users a “secure, low-cost, developer-friendly” approach to creating decentralized apps (dApps) onchain. With Base, the primary focus of Coinbase is to create a “secure bridge” between L2 and L1, as well as other L1 ecosystems such as Bitcoin and Solana. This bridge is designed to provide an easy-to-use onchain experience while also affording access to Coinbase’s ecosystem and products on other chains. The ultimate goal of this endeavor is to create a seamless gateway for Coinbase users to access the broader cryptoeconomy, making web3 more accessible to a greater number of people.

In terms of the technical details, Base is built on the MIT-licensed OP Stack, which is a development stack that powers Optimism. Coinbase will essentially be joining as the second Core Dev team working to make the OP Stack a “publicly available good.” The OP Stack is a standardized, shared, and open-source development stack that creates the necessary infrastructure for running L2 blockchains. This piece of software extends to layers of tools on top of the underlying blockchain, such as block explorers, message passing mechanisms, governance systems, and more.

One of the main challenges facing the web3 ecosystem is the continued market failure that is plagued by archaic regulation and economic behaviors that were strictly built for the physical world. The Optimism Collective has been working to deploy a new model for rewarding those who create or sustain public goods through a model of “retroactive public goods funding” and digital democratic governance. Through this model, Optimism aims to build an infrastructure to better support projects and communities that strictly build for the common good, dispelling the myth that “public goods cannot be profitable.” By identifying ahead of time what is useful and who built it, Optimism hopes to create a system that “withstands the test of time.”

In keeping with the theme of collaboration and decentralization, Coinbase acknowledged that growing today’s crypto economy cannot be accomplished by any single entity or company. In this regard, Coinbase also announced the creation of its Base Ecosystem Fund, which will invest in and support early stage projects building on Base that meet its investment criteria. However, not much information is currently known beyond an application form. Coinbase plans to share its roadmap to mainnet in the coming weeks and provide developers with additional resources to help them build on Base.

In conclusion, Coinbase’s launch of Base and the creation of the Base Ecosystem Fund are significant developments in the web3 ecosystem. The new Ethereum Layer 2 network promises to offer a more secure, low-cost, and developer-friendly way to build decentralized apps onchain. Meanwhile, the creation of the Base Ecosystem Fund provides early stage projects with much-needed support and investment, contributing to the growth and success of the web3 ecosystem as a whole.