Coinbase shifts more USDC balances to Ethereum Layer 2 platform, Base

abdelaziz Fathi

Coinbase today said it plans to store an increased portion of its corporate and customer USDC (USD Coin) balances on Base, an Ethereum Layer 2 network developed by the company.

Coinbase

The move leverages the open-source OP Stack to improve the management and security of customer funds, with the added benefits of lower fees and quicker settlement times.

According to Max Branzburg, Vice President and Head of Consumer Products at Coinbase, this shift would not alter the Coinbase user experience. “This enables us to manage and secure customer funds with lower fees and faster settlement times, with no impact to the Coinbase user experience,” he stated.

The announcement coincides with a notable increase in the total value locked (TVL) on Base, which has seen a surge in user deposits surpassing $1 billion, according to data from DeFi Llama. This represents a strong growth from $470 million recorded earlier in the month, marking the platform’s TVL at more than double in four weeks.

Decentralized exchange Aerodrome has been identified as a major contributor to the rise in Base’s TVL, with its share increasing substantially since early February. Moreover, transaction activity on Base has seen a more pronounced uptick compared to other optimistic rollup solutions, such as Arbitrum, though the latter has also experienced notable growth. The OP Mainnet’s daily transaction count, in contrast, saw a more modest increase.

Earlier this month, a US court ruled that trading crypto assets on platforms like Coinbase constitutes securities transactions.

This judgment emerged from a case involving Ishan Wahi, a former Coinbase product manager who pleaded guilty to sharing insider information in order to profit from cryptocurrency trading, his brother Nikhil Wahi, and their associate Sameer Ramani.

The court’s verdict, particularly focusing on Ramani’s actions, highlights the view that even secondary market transactions of crypto tokens are considered investment contracts under the Howey test. This clarification came through a default judgment against Ramani, who is believed to have left the country to evade criminal charges linked to insider trading.

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