Base, the Ethereum Layer-2 network incubated by Coinbase, has seen its total value locked (TVL) fall by $1.4 billion in the past few weeks.

The decline comes as public debate over the chain’s strategy and product direction intensifies.

Base TVL Slides as Builders, Critics, & Coinbase Leadership Clash Over the Chain’s Direction

Base TVL has dropped from about $5.3 billion in January to roughly $3.9 billion as of this writing.

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The drop matters because TVL remains one of the most closely watched indicators of capital activity and developer confidence in blockchain ecosystems.

However, TVL fluctuations are common across L2 networks, particularly during broader market rotations or liquidity shifts.

As liquidity tightens, Base is also facing unusually open criticism (and responses) from founders, investors, and Coinbase leadership.

Base creator Jesse Pollak framed the moment as part of a typical growth cycle for fast-scaling ecosystems.

“Base went from not existing to one of the most important chains in the world in two years, which happened because of the builders. And as with all fast growth, along the way, some left, some pivoted, some gave up. The builders who remain are the ones who define the next era,” Pollak wrote.

His comments reflect a view held by many infrastructure teams: that early surges often attract speculative capital and short-term projects, followed by periods of consolidation before the next phase of development.

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Critics Argue Base Lost Focus

Some founders and investors say Base’s recent challenges are strategic rather than cyclical. A builder and Coinbase shareholder known as Hish on X publicly criticized the rollout of the Base App, arguing it was marketed as a “super app” but delivered features users did not request.

Investor Mike Dudas echoed similar concerns, saying Coinbase Wallet had previously been positioned as a broad on-chain hub, only to have its priorities shifted by strategic pivots.

Coinbase Leadership Acknowledges Missteps

Coinbase CEO Brian Armstrong responded directly to criticism and accepted responsibility for earlier decisions.

“I’ll take ownership of that if you want to fire someone,” Armstrong wrote, adding that the Base App is now focused on being “the self-custodial version of Coinbase, and trading focused.”

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He emphasized that self-custody is becoming increasingly important as more financial activity moves on-chain. However, the Coinbase executive also articulated that most company resources remain directed toward the main retail platform.

In separate remarks about Coinbase’s broader strategy, Armstrong also noted rising institutional engagement with crypto and highlighted growth in:

• Trading volumes
• Assets on the platform, and
• Product revenue streams,

According to Armstrong, the company remains well-positioned as the financial system grows.

Debate Expands to Ecosystem Design

The discussion has extended beyond immediate product changes to larger questions about how crypto ecosystems grow.

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Uniswap founder Hayden Adams suggested that combining managed accounts and self-custody into a unified interface could improve usability. His remarks reflect ongoing industry efforts to simplify onboarding without sacrificing decentralization.

At the same time, some community commentators argue that Base must strengthen incentives and culture to retain developers and users.

Meanwhile, others counter that long-term adoption depends more on infrastructure, compliance, and institutional partnerships.

If Base can translate its infrastructure advantages and Coinbase distribution into sustained user growth, the current pullback may prove temporary.

If not, competition among Layer-2 ecosystems is likely to intensify as liquidity and developer attention remain highly mobile.

The crypto market continues to trade within a tight range on Wednesday, with bitcoin BTC$68,168.18 rising by 0.9% to around $68,000 since midnight UTC.

The largest cryptocurrency has held between $65,100 and $72,000 since Feb. 6 as market volatility has reduced following a Feb. 5 selloff that took BTC to its lowest point since October 2024.

The altcoin market is running its own race. Monero (XMR) and ADA$0.2849 are posting gains of 3% and 1.7%, respectively, since midnight, while zcash (ZEC) and hyperliquid (HYPE) lost 3.5% and 1.1% over the same period.

The muted performance across the crypto market comes as U.S. equities begin to claw their way out of trouble — S&P 500 and Nasdaq 100 index futures are up 0.57% and 0.66% since midnight UTC as investors await hints on monetary policy when the Fed releases its meeting minutes later on Wednesday.

Derivatives

• Market dynamics have shifted toward stabilization as open interest holds firm at $15.5 billion, marking a transition from leverage cleanup to a steady floor.
• While retail sentiment has cooled with funding rates turning flat to slightly negative (Binance at -0.11%), institutional conviction remains anchored, the three-month annualized basis persists at 3%.
• The BTC options market has reached a state of relative equilibrium, with 24-hour volume split 49/51 between calls and puts.
• While the one-week 25-delta skew has eased further to 11%, the implied volatility (IV) term structure remains in short-term backwardation, as evidenced by the sharp front-end spike in the IV curve before leveling off near 49% for longer dated tenors.
• Coinglass data shows $193 million in 24-hour liquidations, with a 62-38 split between longs and shorts. BTC ($72 million), ETH ($52 million) and others ($12 million) were the leaders in terms of notional liquidations.
• The Binance liquidation heatmap indicates $68,800 as a core liquidation level to monitor in case of a price rise.

Token talk

• The “altcoin season” indicator has risen to 34/100, up from lows of 22/100 on Feb. 8, indicating relative strength across the altcoin market despite relatively low levels of volatility.
• The top performing asset on Wednesday has been WLFI$0.1235, the Trump family-backed DeFi token, which is up 8.8% since midnight and 18.52% over the past 24 hours.
• Investors are betting on WLFI ahead of the projects’s crypto forum at Mar-a-Lago on Wednesday, which will be attended by executives from Goldman Sachs, Nasdaq and Franklin Templeton, among others.
• It should be noted that rallies leading up to real-world events or announcements often result in a “sell the news” scenario as those “buying the rumor” race to secure profits.
• Lending platform Morpho’s native MORPHO token has also been on a bullish run of late, rising by 36% in the past week and 7% in the past 24 hours as traders attempt to capitalize on an otherwise unmoving market.

By Jacob Joseph (All times ET unless indicated otherwise)

Bitcoin BTC$67,408.90 remains within the tight $66,000-$70,000 range we’ve seen in the past few days. At the time of writing, the BTC price was about 1.04% higher over 24 hours. Ether was changing hands at $2,020, up 1.43% on the day.

Institutional positioning remains a central theme.

Digital asset treasury companies and public institutions were among the strongest sources of demand in mid-2025, helping propel prices to record highs. But with bitcoin down more than 50% from its October peak, the landscape has shifted. Many treasury-focused firms are now feeling the strain. Metaplanet reported a $619 million net loss earlier this week, while Harvard Management Company trimmed its exposure to bitcoin ETFs.

Ether treasury firms are also recalibrating. ETHZilla disclosed last evening that tech billionaire Peter Thiel and affiliated Founders Fund entities have exited their entire 7.5% stake in the company. The firm also reduced its ether holdings through multiple sales since October.

Still, not everyone is pulling back.

Michael Saylor’s Strategy continued to build its bitcoin position, adding 2,486 BTC earlier this week and bringing total holdings to 717,131 BTC. Meanwhile, two Abu Dhabi-based funds — Mubadala Investment Company and Al Warda Investments — disclosed yesterday that they collectively held more than $1 billion in BlackRock’s Bitcoin ETF at the end of last year.

BitMine Immersion Technologies announced yesterday that it continues to lean in, adding 45,759 ETH over the past week and bringing its total holdings to 4.4 million ETH. About 3 million of that is currently staked, generating additional yield on top of its core position.

Meanwhile, in a separate development disclosed yesterday, BlackRock advanced its plans for a U.S.-listed yield-generating ether product. An amended S-1 filing signaled further progress toward the iShares Staked Ethereum Trust ETF, with a BlackRock affiliate purchasing 4,000 seed shares at $25 each, providing $100,000 in initial capital for the trust.

While these developments provide constructive long-term signals, it may be premature to call an end to the recent drawdown even with bitcoin and ether trading roughly 50% and 60% below their all-time highs, respectively.

At the same time, TradFi indexes are beginning to show signs of fatigue, as rising AI-related capital expenditures outpace earlier estimates and place increasing pressure on corporate cash flows. Stay alert!

Read more: For analysis of today’s activity in altcoins and derivatives, see Crypto Markets Today

What to Watch

For a more comprehensive list of events this week, see CoinDesk’s “Crypto Week Ahead“.

• Crypto
  • Feb. 18, 1 p.m.: Hedera to undergo a mainnet upgrade expected to take about 40 minutes to complete.
• Macro
  • Feb. 18, 8:30 a.m.: U.S. durable goods orders MoM for December (Prev. 5.3%)
  • Feb. 18, 9:15 a.m.: U.S. industrial production MoM for January est. 0.3% (Prev. 0.4%)
  • Feb. 18, 2:00 p.m.: U.S. FOMC Minutes
• Earnings (Estimates based on FactSet data)
  • Feb. 18: Figma (FIG), post-market, $0.45

Token Events

For a more comprehensive list of events this week, see CoinDesk’s “Crypto Week Ahead“.

• Governance votes & calls
• Unlocks
• Token Launches

Conferences

For a more comprehensive list of events this week, see CoinDesk’s “Crypto Week Ahead“.

Market Movements

• BTC is up 0.86% from 4 p.m. ET Tuesday at $68,227.58 (24hrs: -0.09%)
• ETH is up 1.03% at $2,019.54 (+2.24%)
• CoinDesk 20 is up 0.55% at 1,994.39 (+0.54%)
• Ether CESR Composite Staking Rate is down 3 bps at 2.81%
• BTC funding rate is at 0.0018% (1.9425% annualized) on Binance

• DXY is up 0.13% at 97.28
• Gold futures are up 0.58% at $4,934.20
• Silver futures are up 2.92% at $75.68
• Nikkei 225 closed up 1.02% at 57,143.84
• Hang Seng closed up 0.52% at 26,705.94
• FTSE is up 1.03% at 10,664.40
• Euro Stoxx 50 is up 0.93% at 6,077.76
• DJIA closed on Tuesday unchanged at 49,533.19
• S&P 500 closed up 0.1% at 6,843.22
• Nasdaq Composite closed up 0.14% at 22,578.38
• S&P/TSX Composite closed down 0.54% at 32,896.55
• S&P 40 Latin America closed down 0.62% at 3,694.06
• U.S. 10-Year Treasury rate is up 1.9 bps at 4.073%
• E-mini S&P 500 futures are up 0.52% at 6,896.50
• E-mini Nasdaq-100 futures are up 0.59% at 24,914.00
• E-mini Dow Jones Industrial Average Index futures are up 0.47% at 49,844.00

Bitcoin Stats

• BTC Dominance: 58.56% (-0.01%)
• Ether-bitcoin ratio: 0.02947 (-0.11%)
• Hashrate (seven-day moving average): 1,062 EH/s
• Hashprice (spot): $34.12
• Total fees: 2.29 BTC / $155,681
• CME Futures Open Interest: 116,675 BTC
• BTC priced in gold: 13.7 oz.
• BTC vs gold market cap: 4.5%

Technical Analysis

• The chart shows bitcoin’s price against the dollar in one-week candles.
• The latest reading shows the price remains below the 200-week exponential moving average (EMA).
• Historically, breaks below the EMA have established a “bottom” in a bear market. Whether that’s the case now remains to be seen.
• The lack of divergences in the RSI suggests we are unlikely to see a sustained rebound in the short term.

Crypto Equities

• Coinbase Global (COIN): closed on Tuesday at $166.02 (+1.03%), +1.37% at $168.29 in pre-market
• Circle Internet (CRCL): closed at $61.62 (+2.63%), +2.21% at $62.98
• Galaxy Digital (GLXY): closed at $21.30 (-1.66%), +0.80% at $21.47
• Bullish (BLSH): closed at $32.00 (+0.85%), unchanged in pre-market
• MARA Holdings (MARA): closed at $7.51 (-5.18%), +1.33% at $7.61
• Riot Platforms (RIOT): closed at $14.65 (-3.75%), +1.43% at $14.86
• Core Scientific (CORZ): closed at $17.23 (-3.42%)
• CleanSpark (CLSK): closed at $9.28 (-5.79%), +0.86% at $9.36
• CoinShares Valkyrie Bitcoin Miners ETF (WGMI): closed at $40.00 (-3.24%)
• Exodus Movement (EXOD): closed at $10.09 (-10.47%)

Crypto Treasury Companies

• Strategy (MSTR): closed at $128.67 (-3.89%), +1.27% at $130.30
• Strive (ASST): closed at $8.18 (-1.80%), +0.86% at $8.25
• SharpLink Gaming (SBET): closed at $6.66 (-2.77%), +0.30% at $6.68
• Upexi (UPXI): closed at $0.72 (-6.37%)
• Lite Strategy (LITS): closed at $1.10 (-1.79%)

ETF Flows

Spot BTC ETFs

• Daily net flows: -$104.9 million
• Cumulative net flows: $54.21 billion
• Total BTC holdings ~1.27 million

Spot ETH ETFs

• Daily net flows: $48.6 million
• Cumulative net flows: $11.73 billion
• Total ETH holdings ~5.73 million

Source: Farside Investors

While You Were Sleeping

Milo, a U.S. cryptocurrency lending business that specializes in crypto-backed mortgages, has originated over $100 million in home loans, including the company’s largest single transaction to date, a $12 million crypto mortgage.

The firm, which holds mortgage provider licenses in ten U.S. states with more to follow, has a perfect track record of zero margin calls across its mortgage portfolio, despite enduring consistently choppy periods of volatility for bitcoin and other cryptos, Milo said in a press release on Wednesday.

The firm allows crypto holders to pledge their bitcoin or ether as collateral for loan amounts up to $25 million without having to sell their digital assets, eliminating the need for cash down payments and avoiding costly taxable events.

Stepping back, Milo founder Josip Rupena said people who were perhaps advised by a friend to buy some Bitcoin 10 years ago say, and had the courage to hold on to it through recurring cycles of volatility, may find that today maybe 95% of their net worth is in crypto.

Such people will typically be aged between 30 and 55, have a job, and perhaps a retirement account, but they don’t have enough income to buy the home they would like to, Rupena said.

“Our typical transaction is a million and a half dollar home,” Rupena said in an interview. “A customer might make $100k a year and their crypto net worth might be anywhere from three to seven million. If you were to replace Bitcoin with Apple stock, a product like ours would probably not need to exist. But because the consumer owns an asset that is not widely accepted, plus its concerns around the volatility, means that products like ours do need to exist to help them buy a home.”

Milo asks for 100% of the value of the property in crypto collateral, which can be held with qualified custodians like Coinbase or BitGo, or there is a self-custodial option for those who want to keep complete control of their assets. The loans, which start at 8.25%, can also be used for things like acquiring land, funding home improvements, and business investments.

Unlike regular crypto loans which can have margin calls at 25% drops, Milo designed the product to be more conservative and accommodate 65% drawdowns.

Even in turbulent times like the past few months, if a drawdown situation were to cross the necessary threshold, Milo would reduce the value of the loan, Rupena said, so that the customer could continue to have the mortgage.

“We would just essentially derisk the 100% and bring it down to a 65% or 70%, like a regular mortgage, and then they could continue to make payments. We designed it in a way that as long as a person can continue to make payments, they’re going to be able to continue to have this home. They’re not going to lose their home, because Bitcoin goes down,” he said.

So far Milo has done several transactions in the property hotspot of Miami and more in other parts of Florida, as well as Texas, California, Colorado, Connecticut and Arizona. The $12 million transaction mentioned in the press release was in Tennessee, Rupena said.

The product has been given the blessing of bitcoin pioneer and CEO of Blockstream, Adam Back.

“Milo’s product is a game changer in bitcoin lending and unlocks real world use cases for so many bitcoiners,” said Back in a statement. “While bitcoin continues to appreciate, buyers are able to build equity in real estate and don’t have to sell their long term conviction, bitcoin.”

Solana-based memecoin launchpad Pump.fun has rolled out a new feature that shifts rewards toward memecoin traders rather than its deployers — a tweak to its fee model that once generated over $15 million in a single day at its peak.

In a post to X on Tuesday, Pump.fun said the platform’s memecoin creators can now decide whether a token “truly deserves” Creator Fees, or whether it’s best to redirect rewards to traders engaging with the token through “Cashback Coins.” 

Pump.fun’s original model features Creator Fees, giving token creators 0.3% of all fees generated by the tokens they launch.

However, Pump.fun said not all tokens deserve Creator Fees because many tokens achieve success without a team or project lead, thereby disproportionately rewarding token deployers.

Creator Fees need change. Not every token deserves Creator Fees.

Now, users have the ability to decide whether a token truly deserves Creator Fees, or whether it makes more sense to reward the traders engaging with the token.

Cashback Coins are now live. Learn more 👇 pic.twitter.com/UbYoAbQ1Ya

— Pump.fun (@Pumpfun) February 17, 2026

“Now, traders can choose to engage with tokens they feel the most aligned with, ultimately letting the market decide who gets rewarded and where the bar is set.”

Pump.fun said coin creators must choose between the Creator Fees or Trader Cashback model before launching. Once chosen, the decision is irreversible.

Terminal, a crypto trading platform built into Pump.fun, said Cashback Coins are generated on every trade made and are only accessible through Terminal.

It comes as analysts from onchain analytics firm Santiment said on Friday that memecoins are showing signs of a potential bottom.

“This collective acceptance of the ‘end of the meme era’ is a classic capitulation signal,” Santiment said, explaining that when a sector of the market is completely written off, it is often the “contrarian time” to start paying attention.

Pump.fun fees have fallen over the last year

Pump.fun’s new rewards feature comes as it recorded $31.8 million worth of fees in January, marking a 75.6% fall from the $148.1 million posted in January 2025 — the platform’s best-performing month to date.

Pump.fun has brought in $15.6 million so far in February, putting it on track to fall short of its January total.

The change to the rewards model also follows months of criticism that only a small number of traders were profiting on Pump.fun, while the vast majority of retail traders were incurring losses. 

Data from Dune Analytics shows that of the 58.7 million crypto wallets that have interacted with Pump.fun, only 4.76 million have profited between $1,000 and $10,000, while 969,780 wallets have posted winnings between $10,000 and $100,000.

Less than 13,700 Pump.fun wallets have reached millionaire status on the platform.

The new feature was received well by many in the Pump.fun community, while others, such as X user Coos, pondered whether the rewards model could reduce incentives for developers to launch new coins:

“So devs have less reasons to push coins longer, as the most lucrative time is when coins are still on pf, and have just graduated where there is the most volume.”

Coinbase’s Base shut down its Creator Rewards offering

While Pump.fun has changed its rewards model, others have shut down their rewards programs entirely.