It means something like rational or good from the point of view of the person saying “based”. Or like “based in reality”.
Person 1: “My partner broke up with me and I am sad about it but the relationship wasn’t going anywhere and I think it is better that way. I should work on myself before I can be with someone”
Person2: "that is incredibly based. "
When the world becomes a joke the only reliable way to be informed is to “know your meme”.