Optimism Token Surges 6.5% as Coinbase Builds Its Layer 2 on the Protocol
The optimism token (OP) surged by 6.5% after Coinbase (COIN) said it is building its layer 2 blockchain using the OP Stack in collaboration with Optimism.
OP is the native token of the Optimism protocol, a layer 2 scaling solution for Ethereum that launched last year. It is currently trading at $3.04 following the surge on the Coinbase announcement.
Coinbase's layer 2 blockchain, aptly named Base, will not feature a native token, unlike other layer 2 blockchains such as Polygon (MATIC). MATIC is trading little changed following the announcement.
Whilst the first phase of Base will be a testnet, it's expected that the first decentralized exchange, lending protocol and decentralized apps (dapps) will perform well once the mainnet is live, as similar products surged in volume on protocols like Arbitrum, Polygon and and Optimism.
This is not Coinbase's first foray away from being a typical exchange. Last year it opened its NFT marketplace, although activity has struggled to pick up pace and it continues to fall behind competitors OpenSea and LooksRare, according to data from Dune Analytics.