Tech
Friend.Tech and SocialFi fuel base growth
Franklin Templeton, a major asset manager with a large portfolio exceeding $1.4 trillion, recently turned its analytical gaze towards Base, a layer 2 (L2) blockchain solution built by cryptocurrency exchange Coinbase.
Launched to the public on August 9, 2023, Base quickly rose through the ranks within the blockchain community. In particular, it has attracted attention for its innovative approach in the Social Finance (SocialFi) sector.
The emergence of Base as a SocialFi contender
Franklin Templeton analysis reveals that approximately 46% of all transactions on Base are intertwined with SocialFi applications. This marks it as a crucial sector for Base adoption and subsequent growth. Franklin Templeton highlights Friend.Tech as a great example.
Friend.Tech is a mobile-only application that takes advantage of the monetization of social interactions on its platform. It recently made headlines because of the launch of its second version (Friend.Tech V2) and a native token launch: FRIEND.
To know more: What is Friend.Tech? A deep dive into the Web3 social media app
Social transactions by network. Source: Franklin Templeton Digital Resources
THE FRIEND token it is claimed to be the exclusive property of its user base. It boasts a market capitalization of approximately $200 million, highlighting strong community involvement and investor confidence in the Base ecosystem.
Furthermore, Franklin Templeton emphasized such integration SocialFi Applications directly with Coinbase’s large user base gives Base a unique advantage.
“With support from the Coinbase platform, Base has a strong combination of SocialFi applications and direct integration with Coinbase users, positioning it well to capture a substantial share of the SocialFi business and remain a leader in the Ethereum L2 space going forward,” Franklin Templeton analysts he wrote.
Base uses “optimistic rollups” to speed up transactions and reduce costs. It aggregates transactions from the main Ethereum blockchain. It then consolidates these transactions and finalizes them on the Ethereum mainnet.
This process allows Base to significantly reduce costs while maintaining Ethereum’s high security standards. Base therefore stands out from other L2 solutions.
As compared to other L2 solutions such as Arbitrum and Optimism, Base has shown unprecedented growth. L2BEAT data shows that Base’s total value locked (TVL) increased more than 630% from $742.63 million to $5.45 billion in the year-to-date (YTD) timeframe. In the meantime, Refereethe top L2 solution with a TVL of $16.03 billion, increased only about 47% over the same period.
To know more: A beginner’s guide to Layer-2 scaling solutions
Despite its many successes, Base faces ongoing challenges, particularly with safety of his meme coin designs. As reported in previous reports, 91% of meme coin projects on the Base platform are susceptible to security breachespotentially jeopardizing user investments.
This risk highlights the need for continuous security improvements to protect users and maintain trust in the Base ecosystem.
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