Moonwell on Base Testnet: 5 Things to Know

Moonwell
4 min readFeb 23, 2023

Moonwell will be one of the first projects to deploy on the testnet for Base, a Layer 2 blockchain incubated by Coinbase, with a vision for decentralization over time. With its decade-plus industry experience and 110 million verified users, Coinbase is now aiming to spark a new wave of on-chain adoption.

The Moonwell community’s deployment on Base represents an opportunity for the protocol to greatly expand its reach and realize the community’s desire to further grow the cryptoeconomy through the development and accessibility of open and secure DeFi applications. Below, let’s take a closer look at Base and what its arrival means for the Moonwell community.

Coinbase’s Past, Present, and Future is On-chain

Coinbase made its onchain ambitions public over six and a half years ago in the ironically titled “Secret Master Plan”. In this plan, they expressed their desire to create a financial system consisting of decentralized applications on an open and globally accessible network, with a user base of one billion people.

Coinbase has done more than state its desire to build out the cryptoeconomy, they’ve acted upon it. This can be seen from the founding of the CENTRE Consortium with Circle in 2018, the development of their self-custody solution in Coinbase Wallet, and the substantial Web3 infrastructure investments made through Coinbase Ventures.

Base appears to be the final piece of the puzzle that will enable Coinbase to achieve its onchain vision of global economic freedom, a culmination of its previous efforts and aspirations.

Base is a Scalable, Next-Gen Blockchain

Base is an Ethereum Layer 2 (L2) blockchain, incubated by Coinbase in collaboration with Optimism. As Base is an optimistic rollup, it will offer meaningful improvements in scalability over L1 Ethereum, while still deriving its security from the Ethereum base layer. Coinbase has also made significant contributions to EIP-4844 (sharding), which will further drive down transaction costs and gas fees for on-chain activity.

Smart contracts on Base will be deployed and executed on its Ethereum Virtual Machine (EVM) execution layer. Base goes even further than EVM compatibility and achieves EVM equivalence, or full compliance with the Ethereum yellow paper. This means that developers can be confident that any program that runs on Ethereum will be fully compatible with Base.

BASE Leverages OP Frameworks For Scalability and Development

Optimism is an L2 scaling solution for Ethereum and is the codebase that Base is derived from. Optimism Bedrock is the highly anticipated upgrade to Optimism and will be the first iteration of the “OP Stack” framework. The OP Stack is a set of MIT-licensed open-source software that anyone can use or fork, and represents a vision for Ethereum scalability and modularity.

By modularizing the components of an L2, developers are able to easily insert their own modules at any layer of the stack without compromising the integrity of the entire rollup. With standardization and compatibility, comes the potential for interoperable L2s to manifest into a larger “Superchain”.

Optimism is also strongly committed to open governance and open source principles. This is made evident by the Optimism Collective’s, governance-managed, Retroactive Public Goods Funding model. RetroPGF Round 2 is currently underway and will distribute 10M OP to reward those who have helped to create public goods and open-source software. Base will also contribute to Optimism’s RetroPGF model, further incentivizing the development of the open-source public goods that our digital world relies upon.

Moonwell’s Arrival on BASE is Underpinned By Shared Values

The activation of Moonwell on Base not only represents significant growth potential for the community but Coinbase’s security and trust-focused values also strongly align with the Moonwell community’s core principles.

These values are what originally attracted Moonwell contributors Luke Youngblood and Octavius to Coinbase, and it’s why we’re excited about Base and the potential to onboard the next wave of on-chain adoption; introducing new users to the world of decentralized finance and familiarizing them with our existing deployments on Moonbeam and Moonriver, EVM compatible blockchains on Polkadot and Kusama.

Moonwell’s non-custodial and permissionless nature takes counterparty risk out of the equation. Lending and borrowing are conducted through smart contracts that are regularly audited by Halborn Security. Moonwell markets are secured through the use of Chainlink oracle price feeds to protect against price manipulation. Gauntlet Network has also been enlisted to run economic simulations and ensure that asset risk parameters are set to safe values.

The Vision for Moonwell Apollo and Artemis Remains Unchanged

Since the Moonwell community first activated Moonwell Apollo just over a year ago, we have pursued the goal of connecting the Polkadot and Kusama ecosystems to the world of decentralized finance. We’ve also shared a vision of connected smart contracts with EVM as the base layer. This connected smart contracts vision is further reinforced by the cross-chain integrations and features currently available on Moonbeam, opening up a pathway for the Moonwell community to further integrate with Base.

With the launch of Base, we see a new opportunity to connect the Moonbeam and greater Polkadot ecosystem with Ethereum in a way that wasn’t previously possible. We’re enthusiastic about introducing Moonwell and Polkadot to the Base community and exploring innovative ways to connect these budding and visionary Web3 ecosystems.

About Moonwell

Moonwell is an open lending and borrowing DeFi protocol on Moonbeam and Moonriver. Moonwell’s composable design can accommodate a full range of DeFi applications in the greater Polkadot and Kusama (DotSama) ecosystem.

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Moonwell

An open lending and borrowing DeFi protocol built on Moonbeam & Moonriver