Soon after the debut of Coinbase Global Inc.’s blockchain, dubbed Base, a handful of new crypto tokens with monikers playing on the name have surfaced — despite having absolutely nothing to do with the new network.
(Bloomberg) — Soon after the debut of Coinbase Global Inc.’s blockchain, dubbed Base, a handful of new crypto tokens with monikers playing on the name have surfaced — despite having absolutely nothing to do with the new network.
The testnet of Ethereum-powered Base launched on Thursday, giving developers a window to carry out any debugging ahead of a formal kickoff. The network is being touted as an ecosystem where developers can build decentralized applications, or “dapps,” and will also house Coinbase’s own on-chain products.
But since the announcement, at least four new “impersonation” tokens — coins totally unrelated to Coinbase, which isn’t planning to issue a new network token — have been created, according to Token Sniffer, a data site by crypto surveillance firm Solidus Labs. Confusingly, the names of the new coins range from “Base” and “Base token” to “Coin Chain.”
Anyone who has been in the crypto market long enough will know that generating coins to make the most of fanfare around major news or product launches in the space isn’t a novel idea. Earlier this month, crypto tokens associated with artificial intelligence skyrocketed after OpenAI’s chatbot, known as ChatGPT, became an internet sensation.
“Coins being minted on the basis that they sound like a substantial project but are only taking advantage of a news cycle is a sign of lingering immaturity in digital assets,” said Darius Tabatabai, co-founder of decentralized exchange Vertex Protocol. “Anyone buying these is either making a mistake with a protocol that does something totally different or is just falling for a deliberate fraud.”
It’s no surprise then that crypto enthusiasts would jump on the razzmatazz around Coinbase, the US’s largest cryptocurrency exchange, launching its so-called layer 2 blockchain. Layer 2 solutions aim to make Ethereum network transactions both quicker and cheaper. The project is a collaboration with Optimism, one of the leaders in that corner of crypto. Optimism itself has a native token called OP, for its own layer 2 blockchain.
Not to be left out, speculative traders are also climbing aboard the hype train. The price of BASE, a token of decentralized project Base Protocol — again, nothing to do with Coinbase — soared more than 200% on the Coinbase news, according to crypto price tracker CoinGecko.
Coinbase recently posted a loss of $557 million and saw its revenue decline 75% in the fourth quarter, as reported by Bloomberg, and cut 20% of its staff in January.
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