Coinbase developers are working towards building a new form of decentralized stablecoins that tracks the rate of inflation called ‘flatcoins’ on its newly launched layer-2 network Base.
These asset classes, in contrast to typical stablecoins, are anchored to the cost of living rather than being linked to real-world assets like fiat currencies, which enables them to maintain stability during times of market unrest.
According to a blog titled ‘Request for Builders’, published by Coinbase’s Base Network, flatcoins would enable users to have stability in purchasing power while having resiliency from the economic uncertainty caused by the legacy financial system.
We also welcome other forms of ‘flatcoins’ that do not peg to fiat but rather fill the space between fiat-pegged coins and volatile crypto assets. With the recent challenges in our global banking system, we believe these explorations are more important than ever.
The Coinbase team then provided a brief overview of the other important areas that require attention in addition to flatcoins. They are Onchain reputation, Onchain Limit Order Book [LOB] Exchanges, and Safer DeFi.
By using reputation methods that are inherent to on-chain entities, developers would concentrate on enhancing online trust and preserving user privacy and autonomy at the same time.
This may resemble a FICO or Google page rank type score on ENS names, merchant ratings and reviews, and other trust-building factors on-chain, the blog read.
Next on the agenda is to create a more sophisticated exchange—a limit order book exchange [LOB]—that eliminates counterparty risk through self-custody.
Coinbase Push For LOBs
The team believes that while the existing exchange offerings like AMMs, are crucial DeFi primitive, LOBs would play a greater role, especially for professional traders and institutions.
Finally, in order to construct a more secure DeFi, the exchange would focus on expanding better tools that would allow users and developers to keep up with the speed of innovation while protecting their funds from flaws in smart contract code, assaults on the ecosystem, etc.
The latest plan follows after Coinbase received a Wells notice recently from the SEC involving an unspecified amount of its listed digital assets, including the staking program Coinbase Earn, Coinbase Prime, and Coinbase Wallet.
The exchange criticized the regulator for being “unfair and unreasonable when it comes to its engagement on digital assets,” and vowed to fight back.