Base denies selling ETH, says the network is committed to Ethereum
The post Base denies selling ETH, says the network is committed to Ethereum appeared on BitcoinEthereumNews.com.
Coinbase’s layer-2 network, Base, has denied allegations of selling its Ethereum (ETH) holdings. Over the weekend, crypto community members pointed out that Base has funneled sequencer fees to Coinbase, sparking concerns about transparency and potential ETH sales. However, Base strategist Kabir Sadarangani refuted these claims, asserting that the accusations of a lack of transparency and potential ETH sales were unfounded. The allegations On Feb. 8, Santisa, the CIO of investment firm Lucidity Cap, raised the alarm that Base has been sending all sequencer fees to Coinbase since its launch. He added: “We don’t know if they sold, but we do know they didn’t deploy those funds on Base or keep them on-chain. The lack of transparency makes it fair to assume they sold. Not very Ethereum-aligned of them.” Further analysis by Sonic The Assistant pointed out that the network’s sequencer operations generate nearly a 90% profit margin—over $100 million—and all related ETH was sent from Base to Ethereum and then to Coinbase. Coinbase’s financial reports were puzzling, further adding to the speculation. The Assistant noted that before Base’s launch, Coinbase held approximately 118,924 ETH ($230 million at $1,934 per ETH) as of June 30, 2023. By Q4 2024, this figure had only slightly increased to 119,696 ETH, meaning Coinbase added just 772 ETH ($2 million at current prices) during Base’s operational period. The Assistant also highlighted a recent transaction where 240.35 ETH ($618,960) was moved off-chain to Coinbase. This prompted questions about the whereabouts of the remaining $100 million in sequencer-generated ETH. Meanwhile, Andre Cronje, the co-founder of Sonic Labs (formerly Fantom), also criticized Base’s approach. He questioned whether the platform operates as a centralized corporate blockchain under Coinbase or as a truly Ethereum-aligned layer-2 network. Cronje further challenged the team’s decision to keep fees off-chain rather than maintaining them…
Filed under: News - @ February 10, 2025 10:26 am