Why Base's Extra is Pumping

Extra Finance (EXTRA) has experienced a meteoric rise, shattering its previous all-time high set just last week after surging over 100% in the past 24 hours. What developments catalyzed the run-up, and how will EXTRA sustain the momentum?

While EXTRA holders made big gains at the end of February and into early March, price stagnated throughout the month until yesterday morning when the token began its parabolic ascent.

Alongside the uptick in token price came an increase in total value locked (TVL) on Extra, with this metric up 2x from the start of the month!

Extra Finance is a leverage farming platform deployed to Base and Optimism that enables users to borrow capital from lenders to provide liquidity to whitelisted decentralized exchanges (i.e., Velodrome and Aerodrome) on leverage to boost their yields.

Onchain activity across crypto has increased sharply in recent weeks, as the Ethereum’s L2s that Extra Finance deployed on have enjoyed an added boost to their transactions this month thanks to data cost reductions from EIP-4844.

Higher levels of onchain activity translate to an increased number of swaps, boosting the yields received by leverage farmers on Extra can receive and enabling them to pay a higher cost of capital, which in turn attracts more TVL to the application.

Should L2 yields remain elevated, Extra Finance is well positioned to further increase usage and TVL, particularly through its Base deployment, which has served as the nexus of Extra’s growth throughout the year.

Extra’s continued success on Base, combined with the fact that it is the third largest dApp on the chain by TVL, suggests that it may be a suitable candidate for investment from the Base Ecosystem Fund and listing on Coinbase, events which are both likely to be positive catalysts for price.

Tokens of other popular Base applications, including Aerodrome, have previously received such favor from Coinbase in efforts to support projects building on its chain.