Celo, a distinguished Layer 1 blockchain, has seen its native token drop 5% after its upcoming transition to the Ethereum Layer-2 community in Optimism's Superchain ecosystem turned “questionable.”
On November 27, Coinbase, the biggest US-based crypto alternate, introduced that it could not help Celo's migration to the Layer 2 community. In distinction, Tether CEO Paolo Ardoino confirmed the stablecoin issuer's continued help for the community after transitioning to the Ethereum ecosystem.
Knowledge from fromcrypto confirmed that this uncertainty negatively affected the CELO community token, which fell by 5% to $0.81039 at press time.
Neighborhood response
These differing opinions have drawn combined reactions from the neighborhood, with many criticizing Coinbase's determination.
Marek Olszewski, CEO of developer firm Celo cLabs, expressed disappointment with Coinbase's stance. He questioned whether or not the choice may discourage different Layer-1 chains suitable with the Ethereum Digital Machine (EVM) from adopting Ethereum Layer-2 scaling options.
In the meantime, the founding father of Kraken's Inkchain, Andrew Koller, assured that his alternate will help the migration to L2. acknowledged:
“Kraken and ink (loves) superchain and are absolutely dedicated to scaling Ethereum and making Kraken work for Celo customers. we've requested the related groups to look into it to see if we will hit all the pieces in time for January 16.”
Regardless of the setback, Olszewski steered that the Celo neighborhood take into account renaming their current Layer-1 chain to “Celo Gold (CGLD)” to accommodate Coinbase's present help framework. He hinted that this might simplify future adoption if Coinbase helps the Layer-2 improve.
The neighborhood is urging Coinbase to rethink
EigenLayer founder Sreeram Kannan speculated that Coinbase's determination may stem from a “lack” slightly than outright opposition. He urged the alternate to rethink its place and highlighted the potential advantages of supporting the combination of Celo into the OP bundle.
Kannan acknowledged:
“I feel that is most likely an inside oversight at Coinbase. There is no such thing as a probability that the corporate will construct a number one Ethereum L2 in customers and a serious contributor to OP public items will resolve to cease supporting Celo after it turns into L2 based mostly on the OP stack.
Alternatively, Nass Eddequiouaq, CEO of a16z-funded crypto startup Bastion, highlighted the operational and regulatory complexities exchanges face when including help for brand new chains, particularly within the US. added:
“Exchanges and maintainers have sometimes waited to see which department of the fork initiates exercise earlier than including help for it and discarding the opposite.”
