After Friend.tech, how will Base ecosystem continue?
What's next for the Base ecosystem after Friend.tech?
Author: Jaden, LD Capital
Two weeks after the launch of Friend.tech on the Base chain, user activity gradually decreased, and there was even a net outflow of ETH from the contract on August 22nd. Currently, the total amount of ETH retained in the contract is around 3,500 coins, worth about $5.8 million. Apart from Friend.tech, how is the development of the Base chain ecosystem?
1. On-chain data
1. TVL
As of August 27th, the TVL of the Base chain reached 292 million, ranking 5th in the Layer 2 network and accounting for 3% of the Layer 2 market share. Both Base and zkSync have experienced slow TVL growth and relative stagnation.
2. Trading volume and active addresses
The number of daily active addresses and the daily trading volume experienced two periods of rapid growth, corresponding to the launch of the Base chain mainnet and Friend.tech. As of August 31st, the number of daily active trading addresses was 77,000, and the number of daily transactions was 356,000, both lower than Layer 2 networks such as Arbitrum, Optimism, and zkSync.
The trading volume of DEX on Base reached a low point on August 3rd after the end of the meme coin market. Subsequently, there was a series of new project trading volume rebounds on the chain, but the trading volume began to shrink again after a market downturn on August 16th.
2. Ecosystem projects
As of August 27th, a total of 143 projects/partners were included on the Base official website. Defillama has included 69 projects, and there are only 23 projects with a TVL exceeding 1 million, including 12 DEXs.
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DEX
The initially high-volume DEXs on the Base chain were Leetswap and Rocketswap, but both experienced security incidents.
Currently, the leading native DEX is Aerodrome, with TVL in a fragmented first place state. This DEX has just launched liquidity mining and provides a high APY. Aerodrome is a Base liquidity layer developed by the Velodrome, Base team, and partners. The initial supply is 500M AERO, of which 450M (90%) will be locked as veAERO. The initial circulating supply of AERO is 10M, and the weekly release amount will increase by 3% from the previous week during the 1st to 14th cycles. From the 14th week to approximately the 67th week, the weekly release amount will decrease by 1%. Overall, AERO is a mining coin, and its circulating supply has grown rapidly in a short period of time. After the launch of Baseswap and Alien base on Aerodrome, both TVL and price have declined.
Lending
The largest lending protocol on the Base chain currently is Compound, with a TVL of 23.35 million. The second is the native lending protocol Moonwell on Moonbeam, with a TVL of 19.42 million. Aave voted and launched on the Base chain on the evening of August 20th, with a current TVL of 1.68 million.
The deployer of Magnate Finance, the largest native lending protocol on the Base chain, is associated with the solfire scam. Currently, the project’s Twitter account has been deactivated. The TVL of the remaining lending protocols, Grannay Finance and UncleSam protocol, is below $1 million, and they have no competitive advantages in terms of brand, security, and liquidity compared to established lending protocols like Compound and Aave.
Derivatives
EDEBASE has set up a hybrid liquidity mechanism that allows ELP holders to provide liquidity through a smart router. 45% of the protocol’s revenue is distributed to ELP token holders and stakeholders, similar to GMX. The current TVL is 0.19mln.
Meridian Trade offers interest-free stablecoin lending, leveraged trading, and zero-slippage trading. Users can trade whitelist encrypted assets with up to 50x leverage and obtain interest-free over-collateralized loans in ETH. The current TVL is $50,000.
Social Platform
Friend.tech caused a sensation and attracted a large amount of funds in mid-August. However, starting from August 22nd, there has been a capital outflow from Friend.tech, and the trading activity has significantly decreased.
Game
LianGuairallel is a collectible card game that raised $50 million in financing in 2021, with a valuation reaching $500 million at one point. At the end of July, the game’s beta testing went live, and the game forged its NFT cards on the Base chain.
Conclusion
Multiple Rug incidents have occurred with native projects on the Base chain. From a price performance perspective, there is higher risk in participating in secondary projects. In terms of ecosystem development, projects with high popularity like Unibot are actively joining the Base ecosystem.
