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Coinbase Plans to Increase USDC Balances on Base
Coinbase has announced its intention to boost the storage of corporate and customer USDC balances on Base, an Ethereum Layer 2 solution developed by the exchange and constructed on the open-source OP Stack. This strategic move is anticipated to bring about several advantages, including lower fees, faster settlement times, and improved security measures for managing customer funds.
Benefits of the Decision
- Lower fees
- Faster settlement times
- Enhanced security for managing customer funds
Max Branzburg, Coinbase’s Vice President and Head of Consumer Products, shared the decision in a post on X, emphasizing the ability to handle and safeguard customer funds more efficiently without affecting the Coinbase user experience. He also urged other companies to consider transitioning their operations onchain.
Community Support for Increasing USDC Reserves on Base
The announcement has garnered positive feedback from the community, with Jesse Pollak, a contributor to Base, expressing support and enthusiasm for Coinbase’s move. Pollak described the decision as “based” and pledged ongoing support for Coinbase in their onchain initiatives.
Base’s Growth and Achievements
Base, the Ethereum Layer 2 solution, has witnessed a significant surge in total value locked (TVL). Data from Defi Llama indicates that user deposits on Base have exceeded $1 billion, marking a substantial increase compared to previous figures.
The surge in Base’s TVL can be attributed to the decentralized exchange Aerodrome, which has been a key contributor to the locked value, especially since its notable growth phase that began in early February. Transaction counts on Base have also shown a remarkable increase, outpacing other optimistic rollups in terms of growth.
Changes in USDC Landscape
Coinbase’s decision to bolster USDC reserves on Base coincides with Circle’s announcement of discontinuing the creation of USDC tokens on the Tron blockchain. Circle cited the importance of transparency, trustworthiness, and safety of USDC as the primary reasons for this move.
Binance has also disclosed its decision to cease facilitating deposits and withdrawals of USDC via the Tron blockchain network. However, users can still trade USDC on the platform, and transactions through other supported networks will remain unaffected.
With a circulating supply of approximately $32.1 billion, USDC currently ranks as the eighth-largest cryptocurrency and the second-largest stablecoin after Tether. Most USDC tokens in circulation are based on the Ethereum blockchain, according to Circle’s website.
Ian is a cryptocurrency enthusiast blending humor with professionalism. With an engineering background and a storyteller's heart, he simplifies the blockchain world with sharp analysis and a touch of wit. At Cryptowire, he brings his unique perspective to make digital financial innovation accessible to all.
