BASE chain likely to issue tokens in the future, Coinbase CLO Paul Grewal waits for regulatory clarity
|- BASE chain is likely to issue tokens in the future, according to Coinbase CLO.
- Paul Grewal said that the exchange platform is not focused on the economics and tokenization of BASE.
- Crypto market participants have anticipated a BASE token release since the mainnet launch of the Layer 2 chain in August.
BASE, an Ethereum Layer 2 chain developed by Coinbase, has not completely ruled out the possibility of issuing tokens in the future. Paul Grewal, Coinbase’s Chief Legal Officer, told Decrypt in an interview that tokens may be feasible at some point in the future.
This is a significant development for market participants after airdrops and token issuance by most Layer 2 protocols, including Arbitrum and Optimism in the past year. Airdrop farming has emerged as a reliable passive income opportunity for traders. The community has awaited a BASE token launch since mainnet release on August 9.
Also read: Arbitrum receives 2.5 million ARB funding request from Wormhole foundation
BASE tokens could be a reality, Coinbase has not completely ruled it out
Paul Grewal told Decrypt in an interview on Thursday that the exchange platform may issue BASE tokens at some point in the future. Currently, Coinbase is not paying much attention to the economics and tokenization of the protocol. There are other pressing concerns for the exchange like regulatory clarity.
Grewal explained that the main objective of BASE launch was to put the technology out there for developers and participants to use, and tokenization took a backseat. A primary driver for the exchange was aiding the development of use cases and applications to draw the next 50 million users to crypto.
The legal officer said that regulatory clarity and certainty is important for protocols to have the full functionality to provide incentives like tokenization for users. The executive did not share a definitive timeline for a BASE token launch during the interview, however.
The Coinbase CLO shed light on how the Securities & Exchange Commission’s (SEC) stance on crypto has discouraged innovation. He said clarity in regulation is one of the major barriers for tokenization of protocols, such as BASE.
Coinbase recently summoned the community to ask for regulatory clarity in crypto through organized effort. Grewal said that “Stand with crypto,” is a movement orchestrated to call the 50 million Americans who are associated with cryptocurrencies in one form or another to join Coinbase in its cause for clear regulations on crypto.
Bitcoin, altcoins, stablecoins FAQs
What is Bitcoin?
Bitcoin is the largest cryptocurrency by market capitalization, a virtual currency designed to serve as money. This form of payment cannot be controlled by any one person, group, or entity, which eliminates the need for third-party participation during financial transactions.
What are altcoins?
Altcoins are any cryptocurrency apart from Bitcoin, but some also regard Ethereum as a non-altcoin because it is from these two cryptocurrencies that forking happens. If this is true, then Litecoin is the first altcoin, forked from the Bitcoin protocol and, therefore, an “improved” version of it.
What are stablecoins?
Stablecoins are cryptocurrencies designed to have a stable price, with their value backed by a reserve of the asset it represents. To achieve this, the value of any one stablecoin is pegged to a commodity or financial instrument, such as the US Dollar (USD), with its supply regulated by an algorithm or demand. The main goal of stablecoins is to provide an on/off-ramp for investors willing to trade and invest in cryptocurrencies. Stablecoins also allow investors to store value since cryptocurrencies, in general, are subject to volatility.
What is Bitcoin Dominance?
Bitcoin dominance is the ratio of Bitcoin's market capitalization to the total market capitalization of all cryptocurrencies combined. It provides a clear picture of Bitcoin’s interest among investors. A high BTC dominance typically happens before and during a bull run, in which investors resort to investing in relatively stable and high market capitalization cryptocurrency like Bitcoin. A drop in BTC dominance usually means that investors are moving their capital and/or profits to altcoins in a quest for higher returns, which usually triggers an explosion of altcoin rallies.
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