Celo, a outstanding Layer-1 blockchain, has seen its native token dump 5% after its upcoming transition to an Ethereum Layer-2 community inside Optimism’s Superchain ecosystem turned “contentious.”
On Nov. 27, Coinbase, the biggest US-based crypto alternate, introduced that it might not assist Celo’s migration right into a Layer 2 community. In distinction, Tether’s CEO Paolo Ardoino confirmed the stablecoin issuer’s continued assist for the community post-transition into the Ethereum ecosystem.
Knowledge from CryptoSlate confirmed that this uncertainty negatively impacted the community’s CELO token, which fell 5% to $0.81039 at press time.
Neighborhood response
These diverging views sparked combined reactions throughout the neighborhood, with many criticizing Coinbase’s determination.
Marek Olszewski, CEO of Celo’s developer cLabs, expressed disappointment with Coinbase’s stance. He questioned whether or not this determination may deter different Ethereum Digital Machine (EVM)-compatible Layer-1 chains from embracing Ethereum’s Layer-2 scaling options.
In the meantime, the founding father of Kraken’s Inkchain, Andrew Koller, assured that his alternate would assist the migration into an L2. He stated:
“Kraken and Ink [loves] the superchain and are absolutely dedicated to Ethereum scaling and making Kraken work for Celo customers. we’ve requested the related groups to discover this to see if we will hit all the pieces in time for Jan. sixteenth.”
Regardless of the setback, Olszewski suggested the Celo neighborhood may take into account renaming its present Layer-1 chain to “Celo Gold (CGLD)” to accommodate Coinbase’s present assist framework. He hinted that this may simplify future adoption if Coinbase helps the Layer-2 improve.
Neighborhood urges Coinbase to rethink
EigenLayer founder Sreeram Kannan speculated that Coinbase’s determination may stem from “an oversight” moderately than outright opposition. He inspired the alternate to revisit its stance, emphasizing the potential advantages of supporting Celo’s integration into the OP Stack.
Kannan said:
“I believe that is probably an oversight internally in Coinbase. There isn’t any likelihood the corporate constructing the main Ethereum L2 in customers and a core contributor to OP public items will select to discontinue supporting Celo after it turns into an OP stack based mostly L2.”
Then again, Nass Eddequiouaq, the CEO of a16z-funded crypto startup Bastion, highlighted the operational and regulatory complexities exchanges face when including assist for brand new chains, notably within the US. He added:
“Exchanges and custodian have normally been ready to see which department of the fork picks up the exercise earlier than including assist for it and deprecating the opposite one.”