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Base Parts Ways With Optimism’s OP Stack

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Base, the Ethereum Layer 2 network launched by Coinbase, is transitioning from Optimism’s OP Stack to a self-managed codebase.

Base, the Ethereum Layer 2 blockchain solution developed by Coinbase, is making a significant strategic shift by moving away from reliance on Optimism’s OP Stack.

Optimism’s OP token plunged 7% following the news.

OP Chart
OP Chart

Initially built on Optimism’s OP Stack, Base has decided to transition to its own codebase to gain greater control over its infrastructure and streamline upgrades. This move is expected to double the pace of its major upgrades to approximately six per year.

According to a blog post, the protocol will consolidate upgrades and changes internally, while continuing to collaborate with Optimism as an OP Enterprise client for support during the transition.

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Optimism’s OP Stack is widely used by Layer 2 solutions, and Base’s transition might prompt similar moves by other industry players. Base is the largest Layer 2 by total value locked, with nearly $3.9 billion, according to DeFiLlama.

This article was generated with the assistance of AI workflows.

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Crypto World

Why is the crypto market going up today? (March 13)

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Why is the crypto market going up today? (March 13)

The crypto market rose 2.4% to $2.51 trillion on Friday primarily due to a shift in global risk sentiment following signals of potential de-escalation in the Middle East.

Summary

  • Crypto prices rebounded on Friday after crude oil prices retreated following multi-year highs.
  • A wave of short liquidations across leveraged markets and back-to-back inflows into major crypto ETFs also supported the recovery.

Bitcoin (BTC), the leading crypto asset by market cap, rallied nearly 4%, hitting close to the $72,000 mark. Ethereum (ETH) was up 4.3% over the past day, trading at $2,100 when writing. Other major crypto assets, such as BNB (BNB), XRP (XRP), Solana (SOL), and Dogecoin (DOGE), had also posted modest gains on the day.

It should be noted that today’s market rally was a standalone event as it detached from both the U.S. traditional stock indexes and tech stocks. The Dow Jones Industrial Average dropped by 739 points or 1.56% in U.S. trading hours, while tech-heavy stocks such as the S&P 500 and Nasdaq-100 fell by 103 and 431 points, respectively.

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The crypto market rallied as Investor risk-on sentiment improved after oil prices dropped sharply across the globe. Notably, Brent crude oil fell over 7% today, easing immediate fears of inflation and providing a more favorable environment for digital assets.

Short liquidations mount

As crypto prices rallied, it caught short sellers off guard, triggering liquidations of these highly leveraged positions. Data from CoinGlass shows that nearly $246 million was liquidated from leveraged markets, with the majority coming from short positions.

The total crypto market open interest also rose 5.2% on Friday, signalling that investors were injecting fresh capital into the market.

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ETF inflows and Coinbase premium

Inflows into spot ETF products have also supported the recent gains. According to data from SoSoValue, on Thursday, $53.87 had entered spot Bitcoin ETFs, which marks the fourth straight day of inflows for these funds. A similar trend was visible across their Ethereum counterparts, which have posted three back-to-back days of inflows.

At the same time, Coinbase Premium has also risen sharply over the past 24 hours, indicating that U.S. institutions are paying a premium over global prices to secure Bitcoin. Traders often view this as a strong bullish signal that institutional “smart money” is leading the current market charge.

Crypto market rallied following Trump’s recent comments

Crypto prices also benefited after U.S. President Donald Trump recently hinted that the ongoing war between the two countries may be coming to an end. 

This seemed to have calmed investor fears of a prolonged war, which in turn sparked a risk-on sentiment among investors who have begun moving capital from safe havens back into risk assets like crypto.

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Disclosure: This article does not represent investment advice. The content and materials featured on this page are for educational purposes only.

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Bitcoiner Group to Fight Bitcoin’s Treatment as ‘Toxic Asset’

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Bitcoiner Group to Fight Bitcoin’s Treatment as ‘Toxic Asset’

The Bitcoin Policy Institute (BPI) says it will push the US Federal Reserve to change how Bitcoin is treated, as the central bank is set to issue rules on how banks should implement international guidelines for asset risk weighting.

“BPI will be reviewing this proposal closely and submitting a public comment to ensure that US regulators get Bitcoin’s treatment right,” Bitcoin Policy Institute managing director Conner Brown said in an X post on Wednesday. 

It comes just a day after the Fed announced it will issue a proposal for public comment on how US banks should implement risk-weighting guidance, which determines how risky different assets are on a bank’s balance sheet, from the Basel Committee on Banking Supervision.

Brown said Bitcoin (BTC) is “treated as a toxic asset under the Basel framework, a global standard for banking regulations.

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Source: Conner Brown

He added it carries a 1,250% risk weighting, which was “harsher than virtually all other asset classes.” 

“More efficient regulation” is the aim: Fed

Federal Reserve vice chair for supervision Michelle Boman said on Thursday that the agency will be proposing rules in the coming weeks to implement the final phase of Basel in the US.

Bowman said that the aim is “more efficient regulation and banks that are better [positioned] to support economic growth, while preserving safety and soundness.” 

The 1,250% capital requirement means that banks must back any Bitcoin on their balance sheets at a 1:1 ratio with approved collateral, making holding the cryptocurrency more costly than other asset classes. 

Cash, physical gold and government debt carry a 0% risk weight under the Basel framework.

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“The most punitive classification”: Bitcoin Policy Institute

Brown said in a blog post last month that the treatment of Bitcoin is the “most punitive classification” in the Basel Committee’s capital framework and a “category error.”

Related: Bitcoin hugs $70K range as March Fed rate cut odds fall below 1%

In 2021, the Basel Committee proposed placing crypto in its high-risk Group 2 set of assets. Group 2 holdings were restricted to under 1% of the value of their Group 1 holdings.

“This risk weighting makes it extremely difficult for banks to provide financial services to Bitcoiners and Bitcoin companies,” Brown said.

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