Coinbase Moves USDC Stablecoin to Its Ethereum Layer-2 Platform Base

This shift of USDC stablecoin to Base will provide faster settlement times and reduced transaction fees for Coinbase.com users.

Bhushan Akolkar By Bhushan Akolkar Julia Sakovich Edited by Julia Sakovich Updated 2 mins read
Coinbase Moves USDC Stablecoin to Its Ethereum Layer-2 Platform Base
Photo: Shutterstock

In the latest development, crypto exchange Coinbase announced that it would be moving the USDC stablecoins belonging to its customer and corporate accounts, to its Ethereum Layer 2 platform Base. this comes as part of Coinbase’s commitment to leveraging blockchain technology for seamless financial transactions.

Launched seven months ago, Coinbase’s Ethereum Layer-2 Platform Base has witnessed strong growth amid high demand. As reported last week, the Base network has witnessed a strong surge in trading volume and total value locked by its DeFi applications. This also makes Base the sixth-largest Layer-2 scaling solution on the Ethereum blockchain. The Coinbase Base platform leverages optimistic rollups to streamline off-chain transaction processing while ensuring smooth integration with Ethereum’s base layer.

On Monday, March 26, Coinbase Vice President Max Branzburg announced the exchange’s bold strategy on social media platform X. He called this a substantial advancement that seeks to provide faster settlement times and reduced transaction fees for Coinbase.com users. Note that this transition only impacts the Coinbase.com account users. On the other hand, the Coinbase Wallet users remain unaffected since they have direct control over their private keys.

Coinbase Won’t Compromise on Security

Traditionally, Coinbase has always employed a sophisticated multiparty computation system in order to safeguard user tokens. Thus this ensures robust security for digital assets stored on Coinbase.com. Branzburg further emphasized that despite transitioning to an on-chain framework, Coinase remains committed to its foundational policy of 1:1 asset holding. This makes sure that customer assets are fully backed and not subject to lending without explicit authorization from the asset owner.

In addition to the technical upgrade, this move represents a strategic development towards a future where financial systems operate primarily on blockchain technology. David Hoffman and Ryan Sean Adams, co-hosts of the Ethereum-centric show Bankless, also lauded Coinbase’s initiative as groundbreaking. They called this a trailblazing step that could inspire other cryptocurrency exchanges and financial institutions to explore similar blockchain integrations. Hoffman and Adams envision a future where every asset and bank operates on blockchain platforms.

Despite the enthusiasm, some members of the community have voiced concerns over the centralization of Base, with Coinbase currently serving as the sole sequencer. Critics argue that this could undermine the decentralized principles inherent in blockchain technology. However, Coinbase has outlined a long-term vision to gradually decentralize Base, aiming to address these concerns by making Base a more open and participatory network.

Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.

USDC News, Coinbase News, Altcoin News, Cryptocurrency News, News
Bhushan Akolkar

Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.

Bhushan Akolkar on X