Coinbase’s Layer-2 blockchain, known as Base, is taking steps towards decentralization by implementing fault proofs. The Base team announced on October 23 that permissionless fault proofs will be introduced on October 30, aiming to eliminate single-entity control and enhance network security.
Fault proofs are a mechanism that allows users to challenge potentially fraudulent or incorrect transactions on Ethereum Layer-2 networks. By enabling any participant to make claims about the network’s state and dispute invalid withdrawals, Base aims to reduce its reliance on centralized entities. Previously, only a centralized entity had the authority to propose and validate network state. However, with the implementation of fault proofs, anyone can make and challenge fraudulent claims, ensuring a greater degree of decentralization.
The upgrade will also impact withdrawals, as the process will now involve proving and finalizing based on the fault-proof system. The ‘DisputeGameFactory’ contract will replace the ‘L2OutputOracle,’ thereby enhancing security. Withdrawals initiated before the upgrade may face a 7-day challenge period, while those initiated after the upgrade will also take 7 days but could potentially be delayed due to challenges.
Base, developed using Optimism’s OP Stack, draws inspiration from the successful deployment of fault proofs on Optimism’s flagship blockchain, OP Mainnet. Both networks are part of the Superchain ecosystem, a collection of interconnected Layer-2s.
As of now, Base holds the position of the largest Ethereum Layer-2 chain in terms of total value locked (TVL), with a TVL of $2.4 billion, surpassing Arbitrum (ARB) and Polygon (MATIC), according to CoinGecko.
In Q3 2024, Ethereum Layer-2 networks experienced a surge in transaction activity, with Base emerging as the most active Layer-2 network, accounting for 42.5% of all transactions. Daily active addresses on the Base blockchain have also seen significant growth, increasing from 326,000 in May to 1.4 million in October, representing a staggering growth of over 400% in less than six months. Similarly, daily transactions have surged, with the count reaching 137.6 million in September from 65.9 million in May, indicating a remarkable growth of over 100%.
