Base's Growth Dilemma: Why Did Everything Go Right, But Users Still Leave?
Based on the Japanese philosophical concept of "basho" (a field or place that shapes its inhabitants), this analysis explores why Base blockchain, despite initial explosive growth, is now facing a significant user exodus.
Launched by Coinbase in 2023, Base quickly became the fastest-growing Layer 2 (L2) solution, reaching a peak of 1.72 million daily active addresses and $5.6 billion in TVL by late 2025. Its immense distribution power from Coinbase's 100 million users created strong belief it would solve Ethereum's user adoption problem. However, after confirming a token launch in September 2025, active addresses plummeted by 73% to 458,000 by March 2026. The analysis attributes this to Base building a mere "location" for transactions rather than a "basho"—a meaningful context where users form identities and relationships.
Its bet on a tokenized creator economy via Zora also failed; 99.7% of created tokens became inactive. The core issue is that financial incentives can attract users but cannot fabricate a genuine reason to stay. Unlike a "third place" (e.g., a community square), which people return to for non-transactional reasons, Base was designed for extraction, leading users to leave once incentives dried up.
The piece contrasts Base with chains like Arbitrum and Hyperliquid, which, despite also seeing declines, retained users through unique community identity and experiences rather than mere speculation. The conclusion is that the entire L2 model is cooling, and sustainable growth requires building an irreplaceable ecosystem that shapes user identity—something that cannot be engineered through incentives alone. Base's pivot to a self-custody trading app is a rational retreat, admitting its original vision to create a social, habitable chain failed to materialize.
marsbit04/02 06:07
