ZORA drops 95%, Coinbase finally admits creator coins didn't take off

Original author: ChandlerZ, Foresight News

On July 13, Coinbase CEO Brian Armstrong publicly admitted on X that the Base network's content coins strategy, which had been ongoing for over a year, had failed. Starting in 2025, Base aggressively promoted content coins through the Zora platform, embedding them as a core feature in its own wallet product, once positioning Base as the L2 chain issuing the highest number of new tokens.

Brian Armstrong stated, "It didn't work. We pivoted earlier this year. We messed up, time to move on." Meanwhile, the ZORA token, which provided the core infrastructure for this experiment, has plummeted approximately 95% from its all-time high in August last year, with its market capitalization shrinking from roughly $550 million to about $30 million.

From "Every Post is a Coin" to "We Messed Up"

Brian Armstrong's statement provided the clearest confirmation of failure for Base's roughly year-long creator coin experiment. In July 2025, Coinbase rebranded Coinbase Wallet to Base App, simultaneously integrating social feeds, chat, payments, trading, and app discovery features. When Base launched the app in over 140 countries in December of the same year, it was still defined as a product combining social, trading, and payments.

Base's creator economy utilized on-chain social platform Zora for its underlying tools. Content coins corresponded to individual posts; when a user published an image, video, or text, the system simultaneously created a freely tradable ERC-20 token. Each content coin had a fixed total supply of 1 billion tokens, with creators directly receiving 1% (10 million tokens) upon launch. Initially, the token had no price, with on-chain quotes forming only after other users purchased it; subsequent buying and selling determined the market cap and holder profits or losses.

Buyers acquired a token associated with a specific post, which could be sold back to the market at any time. The token did not include copyright of the post, nor did it represent equity, future revenue, or profit sharing from the creator. Zora's terms of service limited the token's use to entertainment, utility, and consumption, requiring users to confirm that their purchase intent did not involve equity or profit sharing. Therefore, a buyer's profit primarily depended on whether subsequent participants were willing to buy at higher prices.

Creator coins, on the other hand, were tied to the entire account, with each Zora account having only one. Also issued with a total supply of 1 billion tokens, 50% entered the public market, while the remaining 50% linearly vested to the creator over five years. Content coins published by the account thereafter were linked to the creator coin. Zora hoped that popular content would boost demand for the creator coin. Creators could sell their allocated tokens and also earned a share of each transaction fee. At the time, Base claimed this structure could bypass advertising, brand partnerships, and follower count thresholds, directly converting attention into trading revenue.

100,000 Tokens Launched in a Day, Trading Didn't Retain Users

Low-cost token minting quickly inflated Base's apparent activity levels. In August 2025, following the relaunch of the Base App, Zora activity hit an all-time high, with over 1.6 million creator coins minted, nearly 3 million unique traders, and a total trading volume exceeding $470 million. The price of the Zora token itself surged nearly 5 times within a month.

In April 2025, after the official Base account published content titled "Base is for everyone" via Zora, the system automatically generated a token with the same name. The token briefly skyrocketed upon launch before crashing approximately 95% within hours. Base explained that the official team did not sell the token nor issue it as an official project, but ordinary users found it difficult to distinguish between a content publication, a token launch, and official endorsement.

Creator Nick Shirley's token subsequently provided a more direct example. Shirley's investigative video garnered over 100 million views on social media, with Brian Armstrong also publicly promoting it. Its creator coin market cap briefly rose to $15 million before rapidly declining. While the viral spread generated short-term buying pressure, it failed to establish sustained demand for the token.

The collaboration between Base and Zora also sparked dissatisfaction among ecosystem developers. Some developers felt Base channeled excessive exposure and resources into Zora and creator coins, failing to build a stable user moat while crowding out visibility for other Base projects. Community members who questioned Brian Armstrong on July 13 also pointed out that many participants incurred losses during the token's downturns.

Still Defending Content Coins in January, Retreating by February

Brian Armstrong was still defending this model in January of this year. Responding to a former Coinbase engineer's critique of the zero-sum nature of content coins, he argued that purchasing content coins would generate economic value and demand for creator coins. About a month later, the Base App announced it would stop Creator Rewards and remove the Farcaster-supported social feed, shifting the product's focus toward tradable assets.

In March, Brian Armstrong first admitted on a podcast that the Base App's SocialFi features "didn't work very well." Subsequently, Base's 2026 strategy placed stablecoin payments and trading at its core. The official disclosure revealed that Base processed over $17 trillion in stablecoin transaction volume in 2025, covering 26 local currencies and 17 countries. These figures provided clearer commercial justification for the pivot towards financial infrastructure.

In the same post, Armstrong rebutted another criticism from @smileyXBT, who argued that Base's current heavy push into AI agents was merely repeating a trend-chasing cycle. Armstrong responded that Base's roadmap was always structured around three priorities: trading, payments, and AI agents, with most resources currently allocated to trading.

From Base's official token minting in April 2025 to Armstrong's "we messed up" admission in July 2026 spanned 15 months. During this period, ZORA's market capitalization evaporated by nearly $500 million. Throughout the process, Coinbase continuously doubled down, embedding Zora into its wallet product, encouraging funds to create creator coin indices, and providing platform-level exposure for insider tokens.

Coinbase can categorize these 15 months as a concluded product experiment, but the losses reflected in holders' accounts will not disappear simply because the strategy has shifted.