Nasdaq-listed cryptocurrency exchange Coinbase’s Layer 2 scaling solution, Base, has experienced a significant shift in capital inflows this year. In 2024, Base led in terms of capital inflows through cross-chain bridges, but it has now become the top loser.
Data from the Artemis Terminal reveals that Base has seen a net outflow of $4.3 billion this year, a stark contrast to the net inflow of $3.8 billion in 2024, which was the highest among the top 20 blockchains.
On the other hand, Ethereum, the largest smart contract blockchain globally, has recorded a net inflow of $8.5 billion this year, in contrast to a net outflow of $7.4 billion in the previous year.
Top chains by net flows (YTD). (Artemis)
The data indicates a shift in momentum as Ethereum regains its position as the leading blockchain.
Crypto bridges play a crucial role in facilitating communication and interaction between different blockchains, enhancing interoperability. Bridging involves transferring tokens across various networks.
The cumulative supply of stablecoins on Base has stabilized above $4 billion since mid-May, alongside a slowdown in trading volumes, as depicted in the chart below.
BASE: Stablecoin supply in USD and DEX volumes. (Artemis)
BASE experiencing ETH outflows
According to L2BEAT, the total amount of ether deposited on Base has plummeted from 1.82 million ETH to just over 835,000 ETH within four weeks.
The number of ETH on Base. (L2Beat)
This trend mirrors the ETH outflows observed in other Layer 2 solutions recently, as highlighted by Michael Nadeau of The DeFi Report on X.
Coinbase’s Protocol Specialist Viktor Bunin suggests that the outflows may be attributed to Binance withdrawing capital to Layer 1.
“The majority appears to be Binance withdrawing to L1. They had a significant amount on L2s. It’s unclear whether they were receiving incentives to keep it there or simply didn’t balance across their supported chains,” Bunin commented on X.