Ethereum: Why Coinbase is Mentioned in BIP
As the second-largest cryptocurrency by market cap, Ethereum is becoming increasingly important for digital assets that go beyond just its native coins. However, when it comes to decentralized finance (DeFi) and blockchain development, there are cases where the name of a major exchange or wallet provider like Coinbase comes up prominently.
One such case is the Bitcoin Improvement Proposal (BIP 34). This BIP, written by Gavin Andresen, a well-known figure in the Ethereum community and former director of the Software Development Foundation, has generated widespread interest from both developers and users. But what exactly is BIP 34, and why does Coinbase play a significant role?
What is BIP 34?
BIP 34 is part of a series of proposals for improving Bitcoin, published in October 2017 by Gavin Andresen as part of an effort to improve the scalability and usability of Bitcoin. The proposal introduces several key changes aimed at improving the functionality of the blockchain, including improvements to how new transactions are broadcast and verified.
Essentially, BIP 34 is a technical implementation detail that facilitates the creation of multiple independent blockchains within the Bitcoin network. By introducing new rules for verifying transactions and creating blocks, this BIP aims to increase the overall capacity of the blockchain, making it more suitable for decentralized applications (dApps) and other use cases.
Coinbase’s Role
Coinbase, a leading digital asset exchange, has played a major role in promoting BIP 34. As one of the largest cryptocurrency exchanges in the world, Coinbase has been actively involved in promoting improvements to the Bitcoin blockchain. Their involvement can be attributed to several factors:
- Advocacy: Coinbase has long been a vocal supporter of changes to the Bitcoin protocol, pushing for increased scalability and usability.
- Partnerships: The exchange has partnered with various developers and organizations to support the implementation of BIP 34, including the research efforts of the Ethereum Foundation.
- Community Engagement: By engaging with the community through social media channels, online forums, and other platforms, Coinbase has helped raise awareness of the importance of BIP 34.
Why Coinbase is notable
Coinbase’s involvement in promoting BIP 34 raised eyebrows among some in the Ethereum and blockchain communities, who might have expected the exchange to prioritize its own interests over those of the broader cryptocurrency ecosystem. However, it seems that Coinbase’s primary motivation was not to promote itself, but to help improve the Bitcoin network.
In an interview with The Block, Gavin Andresen stated, “We’ve been working on BIP 34 for a few years now, and we think it’s going to be a very important improvement to the Bitcoin protocol.”
Conclusion
Coinbase’s mention in BIP 34 is a testament to the importance of decentralization and community-led development in the cryptocurrency space. While it may seem counterintuitive that Coinbase would prioritize its interests over Ethereum’s, their contributions have undoubtedly helped shape the direction of the blockchain.
As the cryptocurrency landscape continues to evolve, it will be interesting to see how Coinbase’s involvement in BIP 34 is received by other communities and users. One thing is certain: Coinbase’s commitment to supporting technical improvements has left a lasting impact on the ecosystem as a whole.