TechFlow reports on February 10, Base team member Kabir.base.eth denied rumors on social media X regarding Coinbase, the sequencer operator of Base, selling Ethereum (ETH). Kabir stated that Coinbase currently holds over $300 million worth of ETH cumulatively, an amount more than twice Base's historical ETH revenue.
Kabir emphasized that both Base and Coinbase hold and publicly disclose long-term ETH positions (exceeding 100,000 ETH, valued at over $300 million). He also noted that Base uses off-chain custody for security and auditing purposes, which explains why funds are transferred to Coinbase. Additionally, Base pays Layer 1 fees and supports projects in ETH whenever possible.
Previously, anonymous observer Santisa claimed that since Base's launch, its sequencer has transferred all transaction fees to Coinbase and may have sold these ETH. Kabir has refuted this claim.
Notably, Base's sequencer is exclusively operated by Coinbase, responsible for transaction ordering and confirmation, collecting fees paid in ETH. This centralized sequencer model has raised concerns from Andre Cronje, founder of Sonic Labs, who believes it conflicts with Ethereum's decentralization values and could lead to inflation of the Ethereum supply.
Cronje called on Layer 2 solutions to adopt Sonic's free technology to improve throughput and reduce negative impacts on the Ethereum mainnet.
