Base: The Infinity Chain

A Vision for 100x Growth on Base

Base: Uncapped Onchain Growth Potential

Base is the first chain that has truly uncapped potential. The Infinity Chain, if you will, with all the right pieces to grow several orders of magnitude from here.

World class team. Top-notch tooling. Fortune 500 status. And Coinbase is hell-bent on moving their core business onchain. All the components primed to become the first Trillion-dollar onchain economy. Let’s dig in.

A Clean Slate & Strong Foundation

What I respect most about Base is they’ve done everything “the hard way.” The route of minimal incentives & maximal distribution. They have clearly built for their builders.

Of course they’ve had the luxury of major backing from a CEX, but over the last 5 years we’ve seen every CEX try their hand at growing an EVM ecosystem. There are none as healthy, well-adopted, or mometus as Base (outside of BNB). It’s clear that Base is a self-sustaining ecosystem of it’s own at this point & Coinbase influence is just fuel on the fire.

Total Base Chain Revenue

There is outsized demand for building on Base, as they’ve surpassed BNB in lifetime chain revenue earlier this year at $145M.

Our thesis is that this is just the beginning & we well see Base tackle new growth avenues with scale unseen before in crypto.

Reason 1: The BASE Token

Base is sitting on top of a massive keg of dry power, waiting to explode; The BASE token.

Base is in a very unique & advantageous situation compared to other ecosystem tokens pre-TGE. They have no IOUs to builders, VCs, or other counterparties. A clean slate to design from.

Let’s say the market cap of BASE reaches 50% of BNB, which is a reasonable comparison given TVL, sequencer revenue, active builders, etc. This would put BASE at a roughly $75B market cap. (A bit higher than JPM’s $34B in potential token value).

I’d expect Base to use an OP-esque structure, where they offer grants to their ecosystem through builders/creators, with the token sink being governance power & sway over the chain + incentives.

Optimism set aside 19% for users, 20% to Retro funding, and 25% to Ecosystem funding. That’s 64% used for stimulus, about $48B projected from above.

Of course the numbers just get absolutely silly at this point, but it’s clear that BASE is going to unlock billions of dollars of capital to onchain builders, creators, and users.

If Base has grown to its current size with modest ETH/USDC grants, builder-orientation, and strong distribution… imagine what Base can do with more significant incentives.

Reason 2: Base Pay & Stablecoin Adoption

On the not-so-speculative side of things, Base is pursuing much richer avenues for adoption; the consumer + merchant relationship.

Stablecoins will eat the financial world & Base is positioned to be a market leader, with their stake in Circle’s USDC + Base Pay’s integrations with millions of merchants through partnerships like Shopify.

Base Pay is Almost Too Easy

Swipe fees from credit card processors hit a record $187.2 billion in 2024. Base Pay can bring a 3% swipe fee to 0.0001%, or entirely free. Once the distribution network & merchant/POS tooling gets strong enough, stablecoin payments will become ubiquitous & Base will be the rails it rides on.

I personally loved the UX buying Nouns Coffee at BaseCamp002 this year, a cash-like experience directly prompted in the Base App. I’d imagine Base further abstracts this, giving users the ability to pay in stables on familiar services like Apple Pay. There’s infinite potential here.

Reason 3: Coinbase’s Onchain Focus

My favorite (Coin)Base statistic is how Base DeFi TVL is dwarfed by Coinbase Custody. Base is currently sitting at about 1% the size of the $500B in holdings. Of course that won’t all be moved overnight (or ever), but Coinbase hasn’t been shy about its onchain intents.

Coinbase Custody Dwarfs Base TVL

They are moving aggressively with their retail DEX, onchain lending, and borrow products. This is clearly a continuous trend with the results they’re seeing (such as $1B in Bitcoin-backed loans originated through the Retail app).

Additionally, Coinbase has the access & reputation to play with the big boys in the RWA & banking space, exemplified by JPMorgan testing deposit tokens on Base & many RWA projects moving to Base.

Finally, with their acquisition of Echo.xyz for $375M, they’re targeting onchain capital markets from every possible angle, and will be obviously pushing much of this onto Base.

Reason 4: Base is (risking it) for Everyone

While Jesse/Base’s emphasis on coining content has certainly created some controversy, it’s clear that they are willing to take massive risks to tap into new market segments.

Like it or not, that’s up to you. But anyone serious about bringing the world onchain will have to do controversial things. That’s the natural consequence of contrarian thinking.

Coin Everything; Visionary or Time to Pivot?

Judging the current state of these efforts as if they’re the end state, is diminishing the Base team’s ability to ideate, take feedback, and ship.

The current pushback reminds me of Brian Armstrong’s “Coinbase is a mission focused company” from 2020. In the height of political-corporate wokeness, Coinbase expressed its core values. Coinbase was eaten alive at the time by media, only to be praised in more recent years.

Whether the current approach to new creator markets is visionary or will require going back to the drawing board is up for debate. But there’s no doubt in my mind they’ll crack it and bring these scalable, global markets onto Base.

Reason 5: First-Class Infrastructure

As a builder, I have come to appreciate Base’s infrastructure. There are a lot of hidden things users don’t see that make builders’ lives easier. The tooling is second-to-none, the adoption is virtually everywhere, and the distribution channels are plentiful.

Additionally, Base offers an experience that users do see; fast, cheap, and accessible. They’ve been putting in the groundwork to increase the Mgas/sec over the past two years, and have been unrelenting in their Ethereum alignment.

L2 Beat Statistics

It’s hard to quantify the exact implications of these things, but it is a defining factor when devs choose where to build. As Steve Ballmer once said, “Developers, developers, developers, developers, developers, developers.”

The traction is proof. Devs want to be on Base. And there are a lot more coming.

Peeking into the Infinity Chain

As we progress in this direction, it’s clear there will be millions of tokens and thousands of protocols deployed across Base over the next few years. They all share one common need.

Liquidity is the lifeblood of onchain activity. Without liquidity, tokens cannot be traded, protocols cannot operate, and users cannot participate. Each token and protocol often has different liquidity needs that take many form factors.

This is the Hydrex thesis, and the catalyst behind our Omni-Liquidity architecture. Omni-Liquidity allows Hydrex to source liquidity for any token OR entire protocol, utilizing the familiar and effective ve(3,3) incentive flywheel.

Hydrex Incentivizes 3 Types of Liquidity Now, with More on the Way

Hydrex is early. At 5 weeks, we are primarily focused on sourcing liquidity for Hydrex & UniV4 LPs. It’s the most obvious and natural starting point. But thinking that this is the end game, is very short sighted.

Morpho gauges are coming soon to exemplify our capabilities with different market types, and more integrations are on the way. We are very open to feedback as we help bootstrap token liquidity in the short-term, and protocol liquidity in the long-term.

Hydrex is gearing up for the Infinity Chain.

-glee