$16M in crypto lost to hacks in August: Report
Coinbase's layer-2 solution, Base, experienced four security incidents shortly after its launch, resulting in the loss of $15.8 million in cryptocurrencies in August.
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Posted 8/31/2023, 4:02:39 PM
cointelegraph.com
Relevant topic timeline:
The main topic is the launch of Coinbase's layer-2 blockchain Base's mainnet to the public on August 9. Key points include:
- Base has been operating on the testnet since late February and launched its "builder only phase" in mid-July.
- Users can start bridging their funds onchain to mint NFTs and experience Base.
- Base will kick off its Onchain Summer initiative, partnering with consumer brands like Coca-Cola and Atari.
- Base has seen over $68 million worth of ether bridged to the network and over $200 million in trading volume and transactions.
- The blockchain is partnering with Prop House to offer grants to builders building on Base.
- Onchain activity is growing quickly.
The main topic is Coinbase's second quarter earnings report. The key points are:
- Coinbase generated total revenues of $707.9 million in Q2, beating market estimates.
- The company had a net loss of $97 million but generated a positive adjusted EBITDA of $194 million.
- Analysts had mixed expectations prior to the earnings report.
- Coinbase's quarterly recurring operating expenses have dropped nearly 50% year-over-year.
- After the earnings report, Coinbase's stock rose 7% in after-hours trading but retracted 2% at the time of publication.
- Coinbase's stock is up about 170% year-to-date.
- As of March 31, 2023, Coinbase had $145 billion in quarterly volume traded and $130 billion in assets on its platform.
Cryptocurrency exchange Coinbase is acquiring a minority stake in Circle Internet Financial, dissolving their partnership and bringing the stablecoin USD Coin fully in-house, while also adding native support for USDC on six additional blockchains, bringing the total to 15.
Coinbase's new Base blockchain, which operates as a layer-2 network atop Ethereum, has gained significant traction with its application Friend.tech attracting over 100,000 users and generating $25 million in fees, pushing its total value locked past $200 million and its transactions per second above Ethereum and rival layer-2 projects Arbitrum and Optimism.
Base, the Layer 2 scaling solution from Coinbase, has experienced a significant increase in transactions per second (TPS) due to the trend called Friend.tech, according to CEO Brian Armstrong. Base's TPS has exceeded that of Ethereum, with a TPS value up by over 75% in the past week, making it a major L2 protocol to watch out for.
Coinbase's layer-2 solution, Base, has become the fastest network to reach 1 million addresses, attracting big brands and generating $3.3 million in profit since its launch.
Ethereum staking services have agreed to limit all validators to 22% in order to ensure the decentralization of the Ethereum network, while DeFi hacks and exploits resulted in a loss of $16 million in August, including a nearly $900,000 exploit on Balancer protocol, and Shibarium's second launch saw over 100,000 new wallets added to the layer-2 protocol. Additionally, the USDC stablecoin is set to launch on Coinbase's layer-2 platform, and the DeFi market experienced a bearish decline in response to a delay in the approval of a Bitcoin spot ETF.
Coinbase's Ethereum layer-2 network Base experienced its first major outage, lasting for 43 minutes, due to a delay in block production, highlighting the potential risks of using layer-2 networks compared to Ethereum's mainnet.
Cheap and speedy layer 2 rollup networks like Arbitrum, Optimism, and Coinbase's Base are gaining popularity as alternatives to the congested Ethereum network, but concerns arise over the centralized nature of their sequencers, which could pose risks such as transaction censorship and system failure. However, experts argue that the bigger security concerns for layer 2 networks lie elsewhere, such as the lack of fraud proofs and escape hatch mechanisms.
CoinEx, a global cryptocurrency exchange, suffered a hack where large amounts of digital assets were stolen, with preliminary estimates suggesting a loss of around $43 million, possibly linked to the North Korean hacking group Lazarus.
Coinbase has reportedly earned a $1 million profit from the $73 million Curve exploit in July, but has refused to refund victims, highlighting the tension between the decentralized nature of blockchain finance and the lack of recourse for crypto theft.
Coinbase's layer 2 blockchain, Base, has experienced a surge in daily transactions, reaching an all-time high, with the increase mainly driven by a decentralized social network platform called Friend.tech.
Coinbase's layer-2 scaling solution Base set a new daily transaction record with over 1.8 million transactions, surpassing the combined total of its rivals Arbitrum and Optimism.