Coinbase's Base Likely to Include Anti-Money Laundering Measures and Transaction Monitoring

Coinbase CEO Brian Armstrong said that the company's layer-2 network, Base, will likely include transaction monitoring and anti-money laundering (AML) measures.

In an interview with Bloomberg, Armstrong explained that

Base currently has centralized components but will become more decentralized over time. However, he noted that in the early days, the company has responsibilities in terms of transaction monitoring and AML compliance that it needs to address.

While Base will be open to all developers, Coinbase's initial announcement stated that it would be "home for Coinbase's on-chain products," which will likely maintain their original know-your-customer/AML measures. The announcement also indicated that Base will become "progressively decentralized" but did not suggest a lack of regulatory compliance.

Coinbase announced Base on February 23, stating that it will build the platform in collaboration with Optimism, an existing Ethereum layer-2 project. The platform is currently in testnet and is not yet available for actual use cases. Coinbase has not yet announced a mainnet launch date.