Primary Bridge for Coinbase’s L2 Base Reaches Record Level of ETH Held

The amount of ETH in Base’s bridge has climbed to an all-time high of nearly 623,130 ETH, which is currently worth about $1.6 billion.

The bridging smart contract for Base, the fast-growing layer 2 blockchain incubated by Coinbase, has reached an all-time high for the amount of ETH held. 

The bridge’s ETH balance increased by more than 94,728 ETH in the last 30 days to nearly 623,130 ETH, worth about $1.6 billion at presstime. This is a record level for the smart contract (0x490), making it the eighth-largest holder of ETH, data from block explorer Etherscan shows.

Bridges—critical pieces of blockchain infrastructure that enable crypto users to transfer assets across various networks—often serve as indicators for emerging trends, because these smart contracts are typically the starting point for any onchain actions such as lending, transacting, and airdrop farming. 

Just over a year old, Base has become a magnet for ETH due largely to its association with Coinbase, the largest crypto exchange in the U.S., as well as its integration into Optimism’s Superchain, according to Paul Vaden, a core contributor at the Lyra Foundation. Lyra Foundation aids in the development of trading platform Derive Protocol on Ethereum. 

“Coinbase, who everybody trusts and believes has power in the industry, is throwing all their weight behind a specific chain. I think, basically, people just believe because Coinbase is associated with it, that [Base is] going to succeed,” Vaden told Unchained. 

In addition to its close relationship with Coinbase, Base also benefits from its inclusion in the Superchain, an ecosystem network of layer 2 blockchains built using Optimism’s OP Stack. “Having Base in the Superchain was a huge value-add,” Vaden noted.

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The amount of overall ETH in Base’s smart contracts has increased 12% in the last 30 days and 679% in the past year to 2.91 million, close to its record set last week, according to L2 analytics tracker Grow The Pie. Base trails only Arbitrum in terms of ETH held in its smart contracts.

The growth in ETH on Base means more users are locking their ETH into the L2, a sign of increased adoption and liquidity for the network. 

Crypto users transfer ETH to Base for a wide range of reasons. A person or artificial intelligence bot might want to transact with cheap fees, given how Base’s one-day median fee is less than a cent. Others are attracted to the yields offered by DeFi protocols such as decentralized exchange Aerodrome or lending platform Moonwell. And some might be active in an attempt to earn airdropped tokens. For example, users who interacted with 20 unique contracts on the Superchain, among other criteria, were eligible for Optimism’s fifth airdrop.

Aerodrome, which makes up more than half of Base’s TVL, rewards users with yields in return for providing liquidity to different trading pools. One liquidity pool for WETH and USDC has an annual percentage yield of 1,068%. The DEX’s TVL jumped 55% to over $1.3 billion in the last month. Similarly, Moonwell’s TVL has climbed nearly 43% to $98 million in the same period.