Base Outpaces Arbitrum as Top Ethereum L2 Scaling Solution
Layer-2 Network, Base, Outperforms Arbitrum, Evades Vitalik Buterin's List of Failing Layer-2 Networks
In a significant shift in the blockchain landscape, Base, a Layer-2 (L2) blockchain created by Coinbase, has surpassed Arbitrum (ARB) as the largest Ethereum scaling solution. This transition was triggered by a impressive $557 million surge in TVL (Total Value Locked), according to L2Beat, a platform dedicated to Ethereum layer-2 scaling research and analytics.
Base Dominates Arbitrum on the Ethereum Frontier
Recent data shows that Arbitrum One is no longer holding the title of the largest optimistic rollup on Ethereum, ceding the position to Base by more than $710 million in total value secured (TVS).
With Base now surpassing Arbitrum, it has also progressed from Stage 0 to Stage 1, demonstrating smart contract governance. Even though a security council is still in place to manage potential bugs, this stage features "limited training wheels."
Base's founder, Jesse Pollak, expressed satisfaction with this milestone, commenting, "Proud that Base is now stage 1 - and #1 by TVS but it's still day one. Time to bring the world on-chain."
Embracing On-Chain Creator Ecosystem
Base's mission is to broaden the on-chain creator ecosystem, fostering virality and creativity. Alongside industry leaders like Aave and Uniswap, the leading protocol on Base L2 is Aerodrome, which boasts up to $830 million in TVL.
Meanwhile, Arbitrum still grapples with the aftermath of an 80% crash, with recovery initiatives such as token buybacks and a controversial Nvidia accelerator program bid ongoing.
While this is the first time that Base has outpaced Arbitrum, it's not the first time it has come close. In September, Base TVL exceeded $2 billion after a 400% surge, placing it within distance of Arbitrum's $2.6 billion TVL.
Vitalik Buterin's Cryptographic Trust Vision
Buterin, Ethereum's co-founder, has advocated for advancing cryptographic trust. It is worth noting that he proposed a plan to scale Ethereum's L1 and L2 protocols in 2025, emphasizing incentivizing L2 alignment with Ethereum's ecosystem, such as fee burning, staking, and funding public goods.
His vision for rollups was challenged by Buterin himself in September, when he flagged a select list of L2 networks doomed to fail unless they advanced. However, with Base now among Stage 1 rollups, it has effectively avoided being on Buterin's list of failures.
"Welcome to the full-EVM stage 1 gang Base," Buterin remarked, acknowledging L2 networks that reached Stage 1 maturity based on Buterin's decentralization scale threshold. Buterin defined Stage 1 as having a 75% consensus threshold among Base, Optimism, and 10 independent entities for contract upgrades, and requiring 26%+ of the council to be outside the rollup team.
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Insights
In its progression from Stage 0 to Stage 1, Base has implemented fault proofs (October 2024) for permissionless dispute resolution through open-source challenger software and established a Decentralized Security Council, requiring 75% consensus among Base, Optimism, and 10 independent entities for contract upgrades.
- Base's surge to surpass Arbitrum in Total Value Locked (TVL) points to a transformative shift in the Ethereum Layer-2 (L2) scaling landscape.
- Arbitrum One has ceded its position as the largest optimistic rollup on Ethereum, with Base now holding more than $710 million in total value secured (TVS).
- Progressing from Stage 0 to Stage 1, Base demonstrates smart contract governance, with a security council still in place to manage potential bugs.
- Base's continued growth bodes well for its mission to expand the on-chain creator ecosystem, fostering virality and creativity.
- Arbitrum continues to deal with the impact of an 80% crash, with ongoing recovery initiatives such as token buybacks and a controversial Nvidia accelerator program.
- In a significant milestone, Base TVL briefly exceeded $2 billion in September, putting it in contention with Arbitrum's $2.6 billion TVL.
- Ethereum's co-founder, Vitalik Buterin, advocates for advancing cryptographic trust and scaling Ethereum's L1 and L2 protocols by 2025, emphasizing fee burning, staking, and funding public goods.
- Base's achievement of Stage 1 rollup status observed by Buterin, is a testament to its maturity based on Buterin's decentralization scale threshold.
- Investors are cautioned that while Base's progress shows potential, investments in cryptocurrency are inherently risky, and losses may occur.
