Base Denies Allegations of Selling ETH Holdings, Confirms Ecosystem Commitment
Base, a Layer 2 scaling solution, has refuted claims of selling its Ethereum holdings. Team member Kabir stated that Base is reinvesting all earnings to support the Ethereum ecosystem and has onboarded millions of users in 1.5 years.
Concerns arose after Lucidity Cap's CIO, Santisa, claimed Base was transferring sequencer fees to Coinbase without transparency. An analysis indicated a 90% profit margin on Base's L2 sequencer, generating over $100 million in ETH, with funds moving from Base to Ethereum and then to Coinbase. However, Coinbase’s reports show only 772 ETH added since August 2023.
A recent transaction of 240.35 ETH to Coinbase raised further speculation about fund movements. Andre Cronje criticized centralized sequencers for high fees without significantly enhancing Ethereum's security.
Kabir emphasized that Base and Coinbase hold over 100,000 ETH, valued at over $300 million, making it the largest Ethereum reserve among public companies. He noted that off-chain custody for security reasons necessitates transferring assets to Coinbase and confirmed that Base prioritizes operations in Ethereum for expenses and grants.