Base, the layer-2 network by Coinbase, could dominate the decentralized finance and consumer applications market starting in the second quarter, according to blockchain analytics firm Nansen.
Nansen’s latest report highlights on-chain activity, robust metrics, and a growing user base as some of the catalysts that signal a potential explosive performance for Base in Q2.
This suggests the L2’s continued rise as a core DeFi platform. Beyond leading the next generation of consumer applications, the tailwinds heading into the next quarter shine a spotlight on ecosystem projects and tokens, including the likes of Virtuals Protocol (VIRTUAL) and Aerodrome Finance (AERO).
Strong catalysts for Base in Q2, likely to push total value locked even higher include new app-chains, effect of the U.S. Securities and Exchange Commission dropping its lawsuit against Coinbase and the growing pro-crypto landscape.
“Base is Coinbase’s direct bet on an onchain future and given the large network effects and scale of Coinbase, we see Base positioned strongly,” Nansen wrote in its report.
Combining these catalysts with strong on-chain traction across traditional metrics, such as TVL, stablecoin velocity, and daily active users, paints a bullish future for Base. These metrics reflect developer activity, roadmaps, and funding, forming part of a compelling narrative for Base’s growth.
Nansen analysts view this “State of the Chain” as what sets Base apart from other L2s.
Upcoming developments
Flashblocks, currently live on testnet and set for a mainnet launch in Q2, along with Base appchains and smart wallet sub-accounts scheduled for release in Q2, are notable developments that strengthen Base’s growth outlook.
While Base itself still has no native token, analysts see memecoins and artificial intelligence-linked tokens as some of the assets likely to offer directional exposure to the L2.
Projects such as VIRTUAL, AERO and others offer potentially great entry points given their current performances. The narratives to watch include DeFi meta, gaming, SocialFi and payments. Listing on Coinbase and expansion to Solana are also key ecosystem milestones. Bitcoin (BTC) performance is another.
“With BTC still trading in a range, we’re not in a rush to time altcoin trades, but positioning for a potential breakout remains key. If the momentum shifts, Base-native assets could outperform significantly,” the analysts opined.