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According to DefiLlama’s data, the total value locked (TVL) in decentralized finance (DeFi) has seen a steady decline, with the Layer 2 (L2) blockchain Base losing its place among the top 10 chains by TVL.
Base Suffers TVL Hemorrhage
The Layer 2 project’s TVL was at $412 million, positioning it as the 11th chain with the highest DeFi TVL. Base has witnessed a consistent drop in DeFi activity this year, leading to a decrease in TVL. For instance, according to Artemis, the total volume of daily transactions conducted through decentralized exchanges (DEXs) hosted on Base has dropped by 28% since January 2. As of January 17, Base’s DEX transaction volume totaled $23.34 million, down from $33.21 million on January 2.
In addition to the recorded decline in the DeFi sector, data from Artemis indicates a decrease in user activity across the entire Base ecosystem. Initially, the daily number of unique wallet addresses sending on-chain transactions on the network has decreased by 19% since December 23. The reduction in user numbers also led to a decrease in daily transactions during the same period, which has fallen by 29% since December 23.
Analytics Firm Reports
The increased adoption base recorded after its launch in August 2023 was commonly attributed to activities on the decentralized social network friend.tech. Friend.tech allows users to buy and sell tokenized shares of crypto personalities. However, a significant decrease in friend.tech usage has impacted Base’s network activity. According to Dune Analytics data, the number of daily transactions involving friend.tech on Base has significantly decreased since September 2023.
Due to waning interest in the social network, the daily number of addresses purchasing others’ keys has decreased by 99% since October 22, 2023. As the daily number of users and transactions on Base declined, so did network fees and revenue. On January 1, Base’s network fees dropped to a two-month low of $40,000. According to data from Artemis, as of January 17, Base recorded a revenue drop of 33% to $7,000 since January 1.
