Base Protocol Update: July 2021
By: Base Protocol
Tags: Uniswap, Ethereum, Blockchain, Cryptocurrency, Defi

Acknowledging the community’s feedback on the BASE 2.0 proposal and providing an update on Base Protocol’s future direction.

BASE Direction

As many of you know, the Base Protocol team recently released materials on what we’ve referred to as “BASE 2.0,” a potential version of BASE that seeks to achieve the crypto market cap price peg by different methods than network-wide supply adjustments.

The merit to this idea is that it opens up a way for BASE to be “backed” and allows for better compatibility across popular DeFi platforms and centralized exchanges / lending platforms.

However, it requires more dev support to maintain the peg, requires more effort for users to benefit from supply expansion events through participation in auctions, and it is a major fundamental change to the original Base Protocol experiment that the community has supported so far.

We’ve tracked everyone’s feedback since the release of the BASE 2.0 proposal, and a majority of the vocal community favors pure rebasing.

The team is committed to act in the interest of BASE holders. That’s the reason we made efforts to consider new approaches to the protocol — to be thorough in exploring every option for BASE to become the leading crypto market tracking asset. But we consider BASE holders a part of the team, and the team has made its position clear that it wants to continue as planned from launch.

That being said, BASE will continue on as a rebase token! 🎉

Market Outlook

The Base Protocol journey has been a roller coaster of extreme circumstances. BASE’s explosive first week set the stage for a market frenzy of new launchpad projects through platforms like DuckDAO, Polkastarter, Ignition and more. This ecosystem has made way for communities that often jump from project to project, maintaining enthusiasm at launch and dropping off shortly after. We’ve noticed a lot of the BASE community migrate away from the project in favor of new presale opportunities.

Members of the BASE community often reflect back on the “heydays” with expectations that the project can achieve the same rate of growth again in the future. Our hope is that moving forward, holders will adopt a more sensible outlook.

In the same vein, we should also openly acknowledge some of the challenges we will face moving forward:

Future compatibility with rebasing tokens in DeFi is unknown and difficult to predict (i.e. Uniswap V3 not supporting rebases).

It will take considerable time to integrate cross-chain functionality with reliable cross-chain rebases.

Centralized exchanges hesitate to make integration efforts for listing rebase tokens.

The challenges listed above are likely reasons we haven’t seen many new rebase projects emerge in the market lately. These challenges are by no means fatal to the future of BASE, but might hinder its potential to grow in certain ways.

We and most other teams in the algorithmic price peg ecosystem have acknowledged rebasing as an experiment. Our plan is to continue making the most out of this experiment, leaving no stone unturned. Our goal in this blog post is to make the direction of the project clear and ensure that all holders are aware of the risks / challenges moving forward. It’s possible that, at times, the market determines that rebasing isn’t valuable. It’s also possible that, at times, the market determines rebasing is valuable. Regardless, we will ensure that BASE is able to support continuous functionality throughout any market conditions.

Team Member Update

About three months ago, we onboarded our friend JR3 to oversee the financial modeling and economics behind the BASE 2.0 protocol. Given the decision to move forward as a rebasing token, JR3 will be stepping away from the project. As the mastermind behind BASE 2.0, we greatly appreciate his contributions and note that they are his to pursue separately without any involvement or expectations from the original members of the team. We wish him the best in his future endeavors!

BASE Plans

We will continue in our efforts to make the most out of what rebasing has to offer. Given the continued success of the original / popularly adopted rebasing asset, AMPL, there is certainly room for new BASE adoption.

Currently, BASE is championing the movement towards fully decentralized and automated rebasing. We recently became the first use case for Chainlink Keepers, an integration that now automates daily rebase transactions for BASE. A major focus this year is to build BASE into a truly decentralized and self-sustaining ecosystem for crypto market cap tracking.

Other plans include the release of a new front end (referred to as BASE+), follow ups with DeFi lending platforms and possibly cross-chain functionality.

Along the way we’ll be offering opportunities to get the community more involved, with the end goal of Base Protocol becoming a truly community-driven project by the one-year anniversary. You can expect activities, airdrops, and awesome staking options this year!

Cheers everyone 🍻