Coinbase has recently released its Base app. This new and exciting super app pumps all of Web3’s capabilities into a single app, helping users find their way in the world of crypto more easily. This decision has fueled a robust discussion among advocates and crypto skeptics alike. Some are applauding it as a transformative revolution in transportation, while others question its feasibility and highlight potential downsides. This article explores Coinbase’s new Base app and how it will change the cryptocurrency landscape. In it, we dig into the app’s features, benefits, and potential drawbacks, comparing it to other super apps that already exist, such as WeChat.

Base App: Features and Functionalities

Base has been built as a re-imagined WeChat-style all-in-one base of services-as-a-platform that were never bundled into one cohesive place. It aims to simplify the user experience and improve access to Web3 technologies. The app combines trading, payments, messaging, social media, and mini-apps, all with the ambition of building a seamless ecosystem that keeps their users engaged.

Here are some of the key features of the Base app:

  • Social feed powered by Farcaster protocol: Base App features a social feed that lets creators tokenize each post through Zora, earn directly from tips and sales, and receive weekly rewards for top engagement.
  • Hundreds of mini-apps: The app embeds hundreds of mini-apps, ranging from games to prediction markets.
  • One-tap USDC payments via NFC: Base offers one-tap USDC payments via NFC, making transactions quick and easy.
  • Encrypted XMTP messaging: The app includes encrypted XMTP messaging, where users can share content, transact with AI agents, or send funds securely.
  • "Sign in with Base" integration: Coinbase invites developers to integrate “Sign in with Base” into their own products, simplifying user onboarding.

Base makes it easier for users to engage with Web3 through features such as one-tap NFC payments, encrypted messaging and AI-powered transactions. The app provides a simple and convenient way to add funds with Apple Pay. This novel feature readies it for the everyday user who would rather not have to open up a cumbersome crypto wallet. Base wants to create a more sovereign web identity that gives people the power to own their online persona and information. Coinbase’s Base platform has an alternative “Sign in with Base” feature. This gives users the flexibility of logging into myriad websites and applications with their Base identity.

The Potential Impact of Base

As Base reaches mainstream adoption, it will introduce Web3 technologies to a larger audience. This has the potential to drive rapid adoption and national acceptance. Coinbase wants to use Base to redefine content monetization, allowing creators to earn directly from posts without follower minimums or brand deals, similar to WeChat's platform where users can create and monetize content. To put it simply, Base finalizes payments in less than one second for under a penny. That’s what makes it both quicker and much less expensive than most of the alternatives, similar to WeChat’s payment capabilities in day-to-day existence in China. These apps focus on gaming, yield farming and prediction markets, similar to WeChat’s mega-app mini-apps that offer everything from social media to ecommerce. Base features an open social network powered by Farcaster, where creators own their content and can earn directly from posts, as well as an encrypted chat with AI agents for trading and transactions, similar to WeChat's social media and messaging features.

Base also faces potential challenges. Base’s sequencer, which is centrally controlled by Coinbase, presents further issues with centralization that could invite regulatory scrutiny. The SEC’s case against Coinbase The SEC has accused Coinbase of acting as an unregistered exchange for securities. Until now, the court has declined to analyze whether the SEC’s denial of Coinbase’s petition was adequately reasoned. The SEC's approach to regulating digital assets is unclear, with the agency refusing to spell out how its old rules apply to the novel crypto market. Requiring digital assets to fit into traditional securities regulations creates compliance challenges that are "economically and technically infeasible," according to Coinbase. Judge Bibas' concurring opinion highlighted constitutional concerns surrounding the SEC's approach to regulating digital assets, including due process concerns and fair notice.

Weighing the Pros and Cons

Regulatory uncertainty continues to be a major hurdle for Coinbase and its new Base app. The SEC’s broader regulatory strategy to digitally asset has yet to come into focus. The agency has been unwilling to explain how its current rules would apply to the burgeoning crypto market. Requiring digital assets to fit into traditional securities regulations creates compliance challenges that are "economically and technically infeasible," according to Coinbase. Judge Bibas' concurring opinion highlighted constitutional concerns surrounding the SEC's approach to regulating digital assets, including due process concerns and fair notice.

  • Simplified User Experience
  • Increased Accessibility
  • Sovereign Web Identity
  • Streamlined Onboarding
  • Mainstream Adoption

Base’s sequencer, which is centralized and controlled by Coinbase, raises serious centralization concerns that could attract regulatory attention. How Base overcomes these regulatory hurdles will be critical in determining if Base can scale to widespread adoption as well as long-term success. User experience is another critical factor. Base wanted to make getting started with Web3 as easy as possible. It should do so while still making a safe, secure, simple to use, intuitive app for all users—even those who aren’t crypto-savvy.

  • Decentralization concerns
  • Securities regulations
  • Lack of clear regulatory framework
  • Compliance challenges
  • Constitutional concerns

Regulatory Hurdles and Adoption Challenges

If Coinbase can pull all of these pieces together, Base would fundamentally change the game for Web3. This change would increase its positive impact to an even broader segment of the population. If Base can’t find ways to get around these obstacles, it will likely have a tough time catching on. Otherwise, it risks becoming yet another overhyped project that doesn’t come close to matching the promise and excitement.

Base's sequencer, controlled by Coinbase, raises centralization concerns, which could lead to regulatory scrutiny. Overcoming these regulatory hurdles will be crucial for Base to achieve widespread adoption and long-term success. User experience is another critical factor. While Base aims to simplify Web3 interactions, it must ensure that the app is intuitive and easy to use for a wide range of users, including those who are not familiar with cryptocurrencies.

If Coinbase can successfully address these challenges, Base has the potential to revolutionize Web3 and bring its benefits to a broader audience. However, if it fails to overcome these hurdles, Base may struggle to gain traction and could become just another hyped project that fails to deliver on its promises.