Franklin Templeton Expects Base to Lead Ethereum Layer 2 Market with Memecoins and SocialFi Projects

Franklin Templeton Expects Base to Dominate Ethereum Layer 2 Market

In a recent report, Franklin Templeton, a $1.5 trillion asset manager, expressed high expectations for Base, an Ethereum layer 2 blockchain created by crypto exchange Coinbase. According to DefiLlama data, Base currently holds $1.6 billion in deposits, second only to Arbitrum’s $2.6 billion among all Ethereum layer 2 networks.

The report highlighted Base’s strong support from Coinbase as a major factor contributing to its success. Base has become a hub for memecoin trading and SocialFi projects, with Franklin Templeton noting a significant increase in activity on the platform in recent months.

One of the key drivers of Base’s growth has been the surge in memecoin trading, particularly following Ethereum’s Dencun upgrade, which drastically reduced transaction fees on layer 2 networks. Popular tokens like TOSHI and BRETT saw significant trading volumes on Base, with BRETT reaching a market value of $800 million at its peak.

Additionally, Base has seen success in the SocialFi niche, with approximately 46% of all transactions on the platform related to SocialFi projects. Friend.tech, a popular SocialFi project, was a major draw for activity on Base before the memecoin trading frenzy took off.

Stablecoin volume on Base has also seen a substantial increase, with a market cap of $2.8 billion. Circle’s USDC stablecoin is the dominant stablecoin on Base, a departure from the norm in DeFi where Tether’s USDT usually holds that position. Coinbase’s support for free USDC transfers to the Base chain via its wallet has likely contributed to USDC’s popularity on the network.

Despite the success of Base, the broader crypto market has seen a slight downturn, with Bitcoin down 2.31% and Ethereum falling below $3,000 again. However, the future looks bright for Base as it continues to solidify its position as a leader in the Ethereum layer 2 market.