• Base, a Coinbase-backed layer-2 blockchain, has attracted millions in Ethereum (ETH) ahead of its official launch.
• Over the weekend, BALD token surged by more than 4,000,000%, resulting in traders flocking to the blockchain for potential profits.
• However, many traders have fallen victim to rug pulls and imitation tokens due to the lack of two-way bridge functionality on Base.
Coinbase-Backed Layer -2 Blockchain Attracts $68 Million Ahead of Launch
Base is a layer-2 blockchain launched by Coinbase which has recently attracted millions in Ethereum (ETH). This surge in capital was driven by the massive increase in price of meme coin BALD over the weekend and traders hoping for lucrative returns.
Traders Flock to Token Despite Lack of Functionality
Despite not being open to the public yet, traders were eager to capitalize on the potential profits from BALD token which increased by 4,000,000%. Consequently, over $68 million worth of Ether was bridged to Base within 48 hours according to on-chain data. Unfortunately after its peak price BALD token dropped sharply leaving many followers with minimal returns and struggling with liquidity issues.
Exploitation Breeds Due To Lack Of Bridge
The lack of a functional two-way bridge created an environment where opportunistic developers deployed hundreds of tokens only later executing rug pulls and leaving users with imitation tokens which could not be sold on the open market.
Conclusion
The rush of capital into Base is likely due to token holders searching for ways to make money during these times. Although there are opportunities present with memecoin trading on Base investors must be aware that rug pulls and exploitation are also common phenomena given its lack of two-way bridge functionality.
Take Away
Investors should exercise caution when trading memecoins as there is still potential for exploitation due to lack of bridge functionality on Base’s layer 2 blockchain network.