Base: The Future of Digital Asset Ecosystems

Since Trump's victory, COIN and BTC have seen significant increases, but the author leans more towards ETH and is optimistic about the development of the Base L2 ecosystem.

After Trump's victory on November 5, COIN and BTC led the way, rising 70% and 16% respectively. I personally still lean towards ETH, and based on my October writing about MEME coins, I believe several advantageous factors are converging for the Base L2 ecosystem:

"Winning" the competition with other L2s and even the ETH mainnet, becoming the preferred ecosystem to accommodate MEME, consumer dApps, and attract attention.

Competing alongside SOL's "fully functional" integrated casino model as a top EVM-compatible ecosystem.

My core view is simple: ETH remains the key center of the digital asset ecosystem, and all derivative projects to date rely on two core principles to drive network effects:

a. The "underlying" coin must perform strongly relative to its competitors;

b. The "underlying" coin must possess "scarcity."

Therefore, in this attention-grabbing competition, most of the time, you are essentially choosing a coin (even if this is just a simplified way) to reflect its advantages. In the coming weeks (this trend has already begun), the CT community will discuss why a certain coin may prevail (e.g., SOL's competitors or MEME coins) or why an application supporting a certain coin may succeed (such as utility tokens, DeFi governance, etc.).

What I want to propose is that starting today, a more risk-adjusted choice is to bet on an ecosystem without a coin. In my view, the organization of Base creates the strongest potential for its continued adoption, while the double-edged sword is that it may rely on ETH's resurgence.

However, given that I believe ETH's potential is currently underestimated—if/when the relative values of BTC, ETH, and SOL increase in the coming weeks, there will inevitably need to be a "reservoir" to accommodate this newly generated and circulating wealth.

I Believe Base is Likely to Win This Position

The "faucet" interconnectivity on Base has greatly improved this year but has not received enough attention.

Base has significant strategic value to COIN and has a real balance sheet to provide support.

Base has undergone multiple tests this year and has performed quite well.

I have adjusted my layout accordingly and will discuss my logic and the risks and mitigations involved in redirecting on-chain traffic to Base, which I believe is the most vibrant "playground," in the upcoming tweets.

Memecoins and Their Typically Successful Environments

The key is that low-market-cap memecoins often provide unrelated returns, and on-chain activity typically heats up before and after significant uncertainties.

The Resilience of MEME Coins and Their Role in Portfolio Construction

Reflecting on the Strength of Major Assets and Their Driving Role in On-Chain Activity

Based on the above views, I believe that on-chain activity will show very strong performance in the coming weeks.

The performance of major assets supports this trend—buying pressure is primarily driven by spot trading, and the open interest (OI) of ETH and BTC has mostly reset to pre-election levels, with the rise in financing rates mainly stemming from a lack of new short positions (and the levels that broke through in recent days—the amount of short liquidations has reached $1 billion, the highest this year), rather than excessive leverage usage.

Therefore, based on the view that there is support within the existing price range, I believe on-chain activity will become a gathering place for OTC funds, new funds, and recycled funds. The funds created in the past week contrast with those from 3-4 weeks before the election. The latter witnessed a significant rise in financing and open interest, but aside from BTC, other assets struggled to attract what I call "mercenary funds."

The capital flow in the past week has not only appeared broadly across assets outside of BTC (all selected assets have generally risen globally), but even includes DOGE—this is a very important indicator reflecting the characteristics of these "buyers": willing to use leverage, willing to speculate, and trading 24/7. These buyers are not restricted by U.S. trading hours, similar to BTC's rise in October.

In this price environment, we are still less than a week in—market misalignment is significant: capital needs time to assess whether this funding is irrational or substantive. During this period, projects that can significantly fluctuate on the margin should produce the most notable re-rating effects.

Base is Already "Winning"—Even Without Issuing Tokens

Base may be one of the most misunderstood ecosystems currently; due to its unique construction, Base lacks typical crypto-native investors/KOLs to manage and disseminate information. However, from various indicators, Base is "winning." The attention Base attracts relative to its growth in users/wallets/TVL may be the most disproportionate among all current projects.

Please see the following chart, which captures the attention of elfa ai towards Base. In terms of collective mentions, there were about