Unrelated BASE Token Jumped 250% After Coinbase Starts Layer 2 Network Base
Expect crypto punters to jump on anything with a distant relation to a trending topic to turn profits – as illogical as that may be to a seasoned equity investor.
Base Protocol’s BASE tokens jumped, then dumped, in the past 24 hours following an announcement by crypto exchange Coinbase about the launch of its layer 2 blockchain Base.
Base, which has a tiny $1 million market capitalization as per CoinMarketCap, spiked from $1.9 in European hours on Thursday to over $6.8 after Coinbase’s Base was announced – a gain of as much as 250% for early participants.
Prices gradually corrected amid heavy profit taking, with base dropping overnight to trade just over $2 in Asian morning hours on Friday.
The jump came with a spike in trading volumes, from $46,000 per day to over $566,000 at the price peak, to over $1.1 million at writing time on Friday. These tokens are traded at the crypto exchange Gate and on the decentralized exchange PlasmaSwap.
Base token’s own model is rather novel: its creators say BASE represents the entire crypto industry, with its price pegged to the total market cap of all cryptocurrencies at a ratio of 1:1 trillion.
“BASE allows traders to speculate on the entire crypto industry with one token,” the token’s site says. That narrative has, however, failed to fully catch on with crypto investors.
Meanwhile, Coinbase’s Base is off to a rocky start. Thursday’s testnet rollout racked up user complaints and jabs on Twitter, as CoinDesk reported, with network experiencing problems, and users flooding social media to complain about its overall functionality.