The total value locked (TVL) in Base Protocol has surged past $390 million following the launch of Aerodrome, a new decentralized exchange on the network. This exponential growth signals strong developer and user adoption for the Layer 2 protocol.
According to data from DeFiLlama, Base Protocol’s TVL doubled overnight to over $380 million after Velodrome Finance debuted Aerodrome on the network. In less than a day, Aerodrome contributed nearly half of Base Protocol’s total locked value at over $190 million.
Aerodrome co-founder Alexander Cutler said this immediate liquidity validates their belief that native DEXs can thrive on new ecosystems like Base. The team aimed to boost Base’s liquidity and process a large share of transactions, mirroring Velodrome’s success on OP Mainnet.
Base Protocol went live in early August and has rapidly ascended as the 4th most valuable Layer 2 blockchain by TVL. It currently trails established networks like Arbitrum, Polygon, and OP Mainnet. Within its first month, Base Protocol has onboarded 101 protocols, including top DeFi apps Uniswap, Curve, and Aave.
This growth puts Base Protocol in the top 10 largest networks overall, now ranked 8th with its $391 million TVL. Coinbase first launched Base privately in July before opening access on August 9th. The protocol gained quick traction despite some controversy around rug pulls of projects like BALD.
Base Protocol prioritizes scalability by keeping transactions off the Ethereum mainnet. This lightens the load on the root blockchain while allowing high throughput. The network uses “optimistic rollups” that bundle and validate transactions on Layer 2.
Developers can build apps and DEXs specifically for Base Protocol to better utilize its architecture. The instant success of Aerodrome reveals the potential value of tailoring to new blockchain environments.
According to Cutler, Base Protocol can become the essential hub for Ethereum transactions as more activity shifts to Layer 2. Aerodrome aims to be a core venue for decentralized trading on the network.
Ecosystem-specific DEXs bypass congestion and high fees on generic exchanges. Aerodrome offers fast settlement and minimal costs to demonstrate Base Protocol’s capabilities.
Cutler said Base enables DEXs to provide the experience users expect from centralized platforms. Frictionless onboarding and intuitive interfaces remove adoption barriers.
Base Protocol’s parabolic growth showcases the pent-up demand for scalability in DeFi. Ethereum’s limitations have led activity and users to alternative networks like Polygon and Arbitrum.
But Base Protocol is structurally optimized to support high transaction volumes with low costs. Specialized DEXs like Aerodrome can take advantage of these characteristics to deliver consumer-grade experiences.
Base Protocol’s $380 million TVL only reflects a fraction of Ethereum’s activity. As more developers build for Base and customers trial applications like Aerodrome, adoption could grow exponentially.
This cycle creates a native ecosystem independent of Ethereum congestion and instability. Aerodrome’s liquidity mining program incentives early participation to kickstart the flywheel.
Of course, many risks remain around security, bugs, and developer retention on new networks. But Base Protocol shows the massive latent demand for solutions that scale.
Its rapid ascent up the TVL leaderboard within 30 days reaffirms that Ethereum alone cannot support global adoption. Alternatives like Base Protocol introduce much-needed throughput to accommodate growth.
Aerodrome’s breakout debut bodes well for Base Protocol’s trajectory. However, the network must keep attracting talent and capital to remain viable long-term.
Sustaining growth depends on providing a superior experience to Ethereum. But projects like Aerodrome prove Base Protocol can specifically cater to decentralized apps better than any general-purpose chain.
Specialized blockchains purpose-built for DeFi are poised to capture more activity as Ethereum bucks under its own success. Base Protocol’s start mirrors the beginnings of chains like Solana and Avalanche that now support billions in TVL.
Its support for Ethereum assets and applications grants Base Protocol a headstart in onboarding users and liquidity. But executing on that early lead relies on ensuring gas fees and congestion don’t become prohibitive.
Powering billions in daily transaction volume requires keeping pace with usage growth. Aerodrome’s debut hints at the capabilities unlocked by Base Protocol’s design. Expanding its core developer base can help the network maintain rapid scaling.
