The slang term "based" has its origins in the crack (e.g. freebase cocaine) epidemic; "basehead" is another term for "crackhead" and from there you get "based" as an insult like "are you high‽" for someone being weird or a dumbass.
Then came Lil B. The BasedGod. He took this word that he grew up being insulted with and made his own to express an ideal of "being yourself, not being scared of what people think about you." And because of his social media personality at a pivotal time in the internet, he gained quite the cult following in the 4chan-dominated meme culture, and "based" started catching on among channers.