Letter 52: Base Season: My Thesis
Why Base, Where to Base, and How to Base
If you’ve been following me on Twitter lately you’ve probably noticed me increasingly bullposting Base. I have many reasons why — much too long for a tweet — so i’m going to lay out my thesis here.
It’s worth noting this is not a new thing for me. I covered Base when they first launched over a year ago, and I recommend reading through that post if you’re completely ignorant to what Base is, since I won’t be explaining that here. I also covered Farcaster at the start of this year and recommend reading that too if you’re not familiar with it.
I know I know, I’m asking a lot of you with all the reading.. but I have faith that there are people in this world who still choose to read (and maybe even those who enjoy it!)
The TikTok generation hasn’t won (…yet).
Anyway, in this post I’ll be covering some reasons why I think Base is still a big deal, where on base I am focusing my attention, and how you can get involved from a logistical perspective. I aim to give an ecosystem overview + share some metrics that make me feel increasingly confident that “base szn” is around the corner (if not here already).
Before we dig in though, it’s worth stating the obvious that most of what is covered in this newsletter + most of what exists in crypto atm (especially wrt memecoins) is insanely risky, a huge bubble, and damn near everything WILL crash 95-100% from here. I am trying to trade this market like everyone, and I will be trying to sell my bags when I think things have hit blow off top levels, and will take profits on the way up there. I’ve already taken a bunch of profits.
Don’t be a stubborn bagholder “diamond hands” community member, and don’t get guilted by others into holding. At the end of the day you have to do what is best for you and if you ever have lifechanging money on the table, you sell, you take that money out of crypto, and you change your freaking life.
Seen way too many people roundtrip way too much money to not put this disclaimer up front. The following is my thesis, it could be wrong, it could be mistimed, it could be many other things. DYOR has never been more important. Okay okay with all that out of the way..
Let’s start with talking about the reasons I am bullish, beginning with Coinbase.
Reason #1: Coinbase is kind of a big deal
Coinbase is one of the largest and most significant crypto exchanges (and companies) in the world. Meme coin traders everywhere rejoice if their beloved token of choice ever gets listed on Coinbase, because they know what that means for the price (generally - up!) — this is b/c it offers “normies” or the average crypto enthusiast an easily accessible pathway to trading the token.
Coinbase is on a mission to increase economic freedom in the world, and to bring 1 billion people onchain. While they would undoubtedly be happy if there were a billion users operating on any chain, it is quite obvious that they are specifically trying to onboard users to their own Base chain.
I think most people still underestimate the magnitude of the Coinbase Marketing Machine and how significant of a company they really are.
Part of being the largest exchange in the USA also means that they have constantly been fighting legal and political battles on behalf of the entire crypto industry.
Last year when the SEC decided to sue Coinbase was one of the few rare moments I have experienced in this space where it seemed like damn near everyone united behind the same cause. Nothing like a common enemy to rally the troops. There were of course a few haters, but f the haters, they were so insignificant they barely worth mentioning.
One last thing I want to say specifically about Coinbase — they seem like a genuine company, full of good humans top to bottom. Not that other exchanges don’t or can’t be like that, but the Coinbase vibes just seem particularly high.
Anyway, the tldr is Coinbase is a big fucking deal. They have their own Layer 2 Blockchain. It’s probably a big deal too, and worth paying attention to.
You can’t talk about Base without talking about Ethereum, the chain everyone loves to hate. But I think ETH Season is also around the corner..
Reason #2: ETH Season
Ethereum is a big deal too, btw. I know it’s popular and in vogue to hate on it these days — but tbh I really think it’s the vocal minority on CT that are touting such narratives. Most of the people who actually matter aren’t spending all day on CT. This is true for every chain ofc — but it’s particularly true for Ethereum I think (in part because so many of them are over on Farcaster).
I won’t deny that ETH has had it’s fair share of Ls. There’s no doubt it “lost” out to SOL on many fronts especially over the last 12-18 months. It’s slow and expensive, and it’s still a bit clunky with a fragmented ecosystem among all the L2s (and L3s) out there.
Even in spite of all of this, Ethereum is the 2nd largest marketcap of any chain, close to 4x it’s closest rivals.
Out of the 328 blockchains tracked by Defi Llama, Ethereum still holds over 50% of the TVL. Such a dead chain.
Obviously the ETH price action has lagged behind basically every other coin this year. I’m of the mind that this is about to change.
This is the ETHBTC chart over the last 5ish years. Clearly it hasn’t been a good couple of years for ETH! But anyone who knows anything about charts, markets, and investing, will tell you that you want to buy at times like this, not sell.
The time to swap your ETH for BTC or SOL was 18-24 months ago.
I’m not necessarily saying you should swap your BTC or SOL to ETH now, but, it’s a hell of a better time to do it now than any other time in the last couple of years - that’s for sure.
Yes yes i’m dropping this ole chestnut again. But it’s just so damn accurate and applicable. The best time to buy SOL was during peak fear after the FTX collapse.
I’ll be the first to admit that I was late to the SOL magic of this run (relatively at least, I got on board at about $40 SOL). And I have been a stubborn ETH bull for probably too long than is good for a trader. But I have been a stubborn ETH bull for a reason, many of which are outlined in this post.
A lot of the reasons people dislike ETH are to do with the friction to use the chain such as the gas costs and the slow transacation speeds. L2s fix a lot of that, and are rapidly catching up in the departments they’ve been lacking in. Which takes us to..
Reason #3: The friction is rapidly disappearing
One of the reasons Solana has been so successful lately is their focus on consumer apps, and the end user experience. They’ve made it as frictionless as possible over there, and there’s no denying that it’s infinitely easier for the average person to interact with the Solana blockchain than any other major chain. Low fees and fast transaction speeds are one thing, but mobile friendly wallets like Phantom and apps like Moonshot have had an enormous impact on new user acquisition.
Add onto this the popularity of meme coins and specifically the Pump Fun protocol, and then the network effects of it all, and it truly is no wonder.
But I posit that many of these things are coming or very close to coming for Base. For starters, just today Phantom announced support for Base:
I can’t tell you how many conversations i’ve had in dozens of discord/tg chatrooms over the last few weeks where people go “ah I only have SOL in my Phantom wallet, I don’t know how to use Base”.
I think this is just the tipping point, and we’re going to see many more protocols/apps start to include Base + some more Base-native apps pop up.
Also there are so many people who have Ethereum PTSD from 2021 gas days and the UI/UX of MetaMask that they haven’t experienced interacing on Base with a wallet like Rabby, Rainbow, Phantom, or of course their own native Coinbase Wallet (which has 4.7% native yield on any USDC held in there, prettttty neat).
Reason #4: The people are based af
When it comes to traditional investing in companies or projects, I am a big believer in betting on people. Base has some pretty f’ing based people working their magic:
Brian Armstrong casually meeting with Trump to discuss crypto policy. Brian is an absolute boss of a person btw, read this post from 2020 (yes, sorry, here I am asking you to read more stuff again) and try and think back to what the world was like then and what most large tech companies were doing in terms of taking political stances, and how monstrously different the approach Brian took with Coinbase was.
Then you have the face of base, Jesse Pollak who leads both Base and Coinbase wallet.
I literally have dozens of tweets saved because I was looking for a few to post here to show the type of person he is and particularly the way he’s approaching making Base what it is, and scrolling through his Twitter timeline was just an endless feed of awesomeness. I recommend you do that, but for the lazy aka 99% of you (and it would be me too if I were in your shoes), here are a few of my faves:
Jesse on a 21 day world tour meeting with builders and leaders to spread the good word:
On trying to break into Instagram and TikTok:
On understanding meme culture (recommend watching the video):
And so many more. That’s just two of the many amazing people working on making Base achieve it’s goals. Pretty comfy backing this team.
Reason #5: The metrics look great
Metrics show a notable increase in activity on Base, as well as significant inflows of capital. To me, the greatest metrics to predict whether a chain is liable to see significan success are 1) number of builders/devs creating apps and 2) whether money is flowing onto the chain.
Looking over the last 3 months, Base has had nearly the same amount of net inflows as Solana:
Looking over the last week, Base has dwarfed everyone else:
Transactions have also been ramping up at a steady rate, with an increase in recent days:
A lot of the Base AI agents have been seeing top Twitter mindshare over the last couple of days:
All in all, it’s clear traffic & mindshare is moving towards Base. Whether this will be sustained or a temporary blip is TBD. A lot of people are claiming this is temporary, and that Solana will retain the lion’s share of attention this cycle. I obviously don’t agree, but far be it from me to be so arrogant as to presume I have to be correct and everyone else has to be wrong.
Metrics look good, but metrics can be temporary.
Reason #6: Airdrop Speculation
I want to be clear, this is pure speculation and I have no insight into whether or not there will or won’t be a Base token. They have been pretty clear and vocal that there won’t be a token, but then again so was Optimism and so many other chains.
But with the legal and regulatory landscape significantly shifting, I wouldn’t entirely rule out the possibility of an airdrop at some future date.
That said I wouldn’t put too much stock into it, and i’m personally treating it as a cherry on the top and not something that’s ever really front-of-mind. I would recommend using the chain as normal and experimenting/tinkering around, as that tends to be the best way to avail yourself of airdrops when protocols do launch them.
Alright there are 6 reasons why I’m bullish on Base and think Base Szn might be around the corner, now let’s dive into some places to check out and where I am spending my time on Base:
Focus #1: Virtuals Protocol
You’ve probably heard about Virtuals by now, if not by my tweets/retweets then by the rest of the timeline talking about it too. Simply put, Virtuals is a launchpad for onchain AI agents. In their own words:
It has been gaining slow and steady adoption over the last few months, with things beginning to ramp up a few weeks ago and starting to go parabolic over the last couple of days.
I don’t think I have to tell you that AI is a major narrative in crypto at the moment, and will likely be a major narrative and sector for the rest of the cycle (and, probably, forever). We’ve seen AI memecoins like GOAT and ZEREBRO go bonkers over on Solana, with many many many others also doing well.
Currently the top AI tokens and agents on Virtuals are still only a sliver of the marketcap of the giants from Solana, but when you look at the capital flows and if you expect an ETH Season + Base Season then I think one of the best places to be paying attention to is the Virtuals ecosystem.
The two tokens I am personally most bullish on (and own the most of) are AIXBT and VADER, in addition to the native VIRTUAL token. I own tokens from ~20 agents on the platform though and there are many others that I think will do well, certainly doing greater multiples than the above given they are already at significant market caps.
You can find new Virtual AI Agent tokens being launched here (and also launch your own).
I recommend reading their full whitepaper (there I go asking people to read again) to get a comprehensive understanding of the protocol.
This is also a great thread on Virtuals from last month that gives a high level overview in easy to understand language: https://x.com/S4mmyEth/status/1849885021152108658
Focus #2: Farcaster
Base and Farcaster very much go hand in hand. While many chains are supported and used via Farcaster, Base is basically eating the world atm. You can see by this chart that for most of the year Base has made up between 60-80% of all onchain transactions from Farcaster users, but in recent days that number is hitting 95%+.
Specifically on Farcaster, there has been a lot of attention on two integrations, clanker and anoncast.
Clanker is an AI agent deployed on Farcaster that deploys tokens for people, which anyone can use by @ mentioning it and simply asking it to create a token for you. It seeds a liquidity pool with it’s own funds and will generate some fees for the creator of it. People are treating it as “the pump fun” of Base, though I think it’s not an apples-to-apples comparison.
This website is a good place to track new clanker token launches.
Anoncast is a ridiculously cool bit of tech, which allows people to post 100% anonymously to Farcaster and even Twitter using zk-proof tech (something else I wrote about last year). You can post via this website, and need to hold the anon token (hashtag utility).
Things are rapidly moving over there with devs and tinkerers experimenting with all sorts of new implementations, and it very much pays to pay attention and get into the farcaster trenches.
Would recommend watching this interview where ThreadGuy interviews Dan Romero, one of the founders of Farcaster.
Focus #3: “older” coins, cults, traditional memes, etc
While most of the attention is currently on the above two places, with AI related coins taking the lions share of the mindshare, I think it’s worth also keeping an eye on some of the older tokens on Farcaster that have been around for a lot longer and have some diehard communities.
There’s too many to name but it’s not too difficult to take a look through the Base page on Dexscreener and sort by marketcap and find some nice older memes.
I suspect that if we do get a Base Season, there will be a point in time when attention shifts back to cute animals and traditional memes over the AI/Farcaster stuff (or perhaps, in parallel to it all).
While the Virtuals ecosystem has had an explosive run lately, a lot of these coins have bled over the same timeframe, and going back to the ole “be fearful when others are greedy and greedy when others are fearful” adage, it might be more worth looking where few are paying attention atm.
Focus #4: Random other places
I was planning to write up my own whole section here, but just stumbled upon an excellent tweet that covers 10 cool apps to try, 10 ways to earn onchain, 10 coimmunites to join, and 10 articles to read. So instead of me rambling on, just check out this tweet.
There’s also a near infinite amount of other cool things being built on Base, most of which I obv can’t cover. The above is just what has been taking my mindshare personally over the last few weeks, but I recommend exploring on your own and finding whatever you jive with.
Okay that covers the main places I am looking at, lastly a few words on logistics.
The logistics of interacting on Base
I’ve had so many questions from people who don’t know how to even get started doing stuff on Base, so here’s a crash course / some tips:
If you’ve got money on Ethereum sitting in a wallet, you can bridge to base using a site like Relay or Bungee. They are extremely easy and cheap to use and bridging usually only takes a minute or so.
If you’ve got money in SOL sitting in a wallet, you can also use Relay to bridge, or natively within the Phantom wallet there’s an option to bridge too.
If you want to trade on Base, you can be a luddite like myself and 90% of the time not use a bot, but there are some trading bots that support Base and I suspect there will be more to come soon. Two of the most popular bots are BullX and Photon (disclosure: these are referral links).
The main dexes for buying/selling tokens on Base are Aerodrome and Uniswap. Personally, I prefer to use the dex aggregator LlamaSwap, as it finds you the cheapest routes that will get you the best rate.
Virtuals tokens work a little differently because all of the AI agents can only be traded with the native VIRTUAL token. The most simple way to trade is via their website, but you can also use LlamaSwap to swap Virtuals tokens as long as you select KyberSwap as the dex.
If you’re looking for a wallet for all your Base/EVM tokens, I personally use and recommend Rabby, but also hear great things about Rainbow Wallet. Of course Coinbase has their own wallet, but tbh personally it isn’t quite there yet in terms of functionality compared to the other two (or i’m just a dummy at using it).
Some final words on SOL vs Base and chain rivalry in general
I’ve always thought serious chain rivalry to be pretty stupid. I personally think of “rival chains” as friendly rivals, aka USA & Canada, or Australia & New Zealand. We poke fun at each other, we joke about on Solana being down, ETH costing an arm and a leg to transact on, and Cardano, well, being Cardano.
But at the end of the day if you are here to make money (which I suspect 99% of you are) then you should simply keep an open mind and experiment and go with the flow.
And if you care less about making money, and more about the future of finance and a decentralized and censorship free future, then by all means have stronger opinions and stick to them. You’ll find people at all levels of extremism in this category: Bitcoin maxis who think anything other than Bitcoin is a scourge on this industry. Eth maxis who think Solana is a scourge on this industry. Solana maxis who think Eth/Base are a scourge on this industry.
Hell you even have Bitcoin maxis who hate the ETFs and MicroStrategy, and others who love them.
All this to say — no matter where you stand, you’re gonna find an army of people who think you’re stupid and your opinions are stupid. That’s life tbh, and you can let it get to you or do what I do and simply roll with the punches and follow the money, follow the builders, follow attention, and most of all: follow my own curiosity.
I recommend you do the same. The best alpha is not found following my curiosity, or my posts, or anyone else’s — the best alpha is found by following your own curiosity and going down rabbit holes and thinking for yourself.
Always has been, always will be.
Until next time.. stay based.
Disclaimer: The content covered in this newsletter is not to be considered as investment advice. I’m not a financial adviser. These are only my own opinions and ideas. You should always consult with a professional/licensed financial adviser before trading or investing in any cryptocurrency related product. This Newsletter may contain referral links whereby I receive rewards for people who sign up via my link or code.
Amazing post brother - thank you for everything you have done for the space!
Happy Thanksgiving for you, your family and your puppy <3
Great post bro! 👏