Synthetix to Discontinue Arbitrum Backing, Switches to Basic Protocol instead
In a significant move, the DeFi platform Synthetix has announced plans to phase out its perpetual futures on the Layer-2 (L2) solution Arbitrum and instead focus on its V3 deployment on Base. This strategic decision is driven by a desire to optimize resources and leverage the growth potential and ecosystem support offered by Base.
Optimizing Resources and Performance Advantages
Synthetix aims to concentrate its development efforts on the most promising and scalable platform. With Base being newer and integrated closely within the Coinbase ecosystem, it offers potential for broader adoption and innovation with the V3 protocol.
Differences between Base and Arbitrum
The comparative ecosystem metrics of Base versus Arbitrum play a significant role in this decision. As of mid-2025, Base, backed by crypto exchange Coinbase, is growing rapidly, while Arbitrum, despite its established high TVL, faces challenges in saturation and spam reduction strategies.
| Metric | Base | Arbitrum | |-----------------------|-------------------------------------|----------------------------------| | Total Value Locked (TVL) | Growing rapidly but still emerging, backed by Coinbase ecosystem (Exact numeric TVL unclear in search) | Established, high TVL but facing throughput and spam challenges[1] | | Daily Transaction Volume | Increasing rapidly due to Coinbase integrations and developer incentives | High volume but affected by spam and congestion-related fee spikes[1] | | Number of Active Addresses | Increasing steadily, benefiting from Coinbase’s large user base | Large user base but possibly less growth compared to Base recently[1] |
Arbitrum's architecture attempts to minimize spam by early congestion throttling to maintain decentralization, which can slightly hamper volume but improve network health[1]. On the other hand, Base emphasizes scalability with Coinbase’s backing, potentially poised for higher long-term adoption in DeFi and derivatives like Synthetix V3.
Impact on Synthetix's Platform
Affected markets on Synthetix will enter a "close-only" mode, preventing traders from opening new positions or increasing existing ones. This includes Synthetix's perpetual futures platform Perps and the USDx stablecoin on Arbitrum, which will be discontinued.
Synthetix's third version operates on both Base and Arbitrum, two Ethereum L2 solutions employing optimistic rollups. However, the strategic allocation of development resources and the comparative ecosystem metrics of Base versus Arbitrum have led Synthetix to shift its focus towards Base.
It's important to note that Base does not have its own governance token. Users on Base can trade various synthetic crypto assets with leverage on Perps, just as they do on Arbitrum.
In summary, Synthetix’s move to phase out Perps on Arbitrum and deploy V3 on Base likely reflects a strategic choice to leverage Base’s growth potential and ecosystem support. Arbitrum remains strong but may not match the integration advantages and future scalability offered by Base at this time[1].
Note: The search results do not provide exact quantitative TVL, daily transaction volume, or active address numbers for Base and Arbitrum as of 2025, so this synthesis is drawn from ecosystem context and typical industry developments.
- Synthetix will invest its development resources primarily on the more promising and scalable platform, Base, due to its close integration within the Coinbase ecosystem and rapid growth.
- In the DeFi industry, Synthetix will migrate its V3 deployment away from Arbitrum, as Base offers potential for broader adoption and innovation, alongside differences in transaction volume, TVL, and active addresses.
