Three-Year 'Decentralization' Promise Falls Flat, Is Base Still Stagnating?
Three years after its launch, Coinbase's Layer-2 solution Base has failed to deliver on its decentralization promises, remaining a centrally controlled "Stage 0" network, according to industry monitor L2Beat. The article argues Base functions as a tool for Coinbase to offer unregulated fund transfers, bypassing Know Your Customer (KYC) and Anti-Money Laundering (AML) checks.
Coinbase initially published a decentralization roadmap in 2023, pledging collaboration with Optimism. However, progress stalled. By February 2026, Coinbase abandoned this plan, consolidating all administrative control via two multi-signature wallets. Network outages in June 2026, requiring Coinbase to manually roll back the chain, underscored its centralized nature.
The piece criticizes Base as an inefficient, unstable distributed database—a solved technical problem for decades—that adds blockchain complexity without achieving decentralization. All development and operations are handled by Coinbase employees, making Base a Coinbase product.
Key questions are raised: Did Coinbase ever have a viable decentralization plan? Is full decentralization for Layer-2s feasible in the short term? How long should regulators tolerate a platform operating without required financial licenses? The author contends that after 40 months with no real decentralization progress, continued regulatory leniency is unjustified, potentially constituting unlicensed money transmission.
Foresight NewsAyer 09:03
