Coinbase’s CEO, Brian Armstrong, expressed his optimism about the transformative potential of layer-2 scaling solutions in the cryptocurrency industry during the company’s first-quarter earnings call. According to Armstrong, these solutions will enable the widespread adoption of cryptocurrencies by offering lower fees and faster transaction times, leading to an explosion of crypto use cases.
Armstrong drew a parallel between layer-2 solutions and the transition from dial-up to broadband internet, highlighting how they help blockchains scale. He believes that this scaling will drive the development of numerous new applications in the crypto economy.
Armstrong then turned his attention to Coinbase’s Ethereum layer-2 solution, Base, which is designed to onboard billions of users into the web3 ecosystem. He emphasized that Base has significantly reduced transaction fees and confirmation times, bringing the company closer to its goal of achieving average crypto transactions that take less than one second and cost less than $0.01 anywhere in the world.
In the first quarter, developer activity on Base increased eightfold, and in the past month, Base has processed more than twice as many transactions as the entire Ethereum network on layer 1. Coinbase has made Base faster and cheaper to use through protocol upgrades, resulting in an approximately 80% reduction in fees. As a result, their fees frequently fall below $0.01.
Regarding Bitcoin, Armstrong credited spot market exchange-traded funds (ETFs) with reinvigorating the entire crypto market. He observed that ETFs garnered significant attention and generated interest and energy across various products in the industry whenever there was a focus on cryptocurrencies.
In conclusion, Armstrong’s positive outlook on layer-2 scaling solutions and the impact they will have on the crypto economy reflects Coinbase’s commitment to driving innovation and accessibility in the industry.
