Citizen DeFi Play: Blast Mobile

Crypto Twitter has been buzzing with critiques over Ethereum L2 Blast’s lackluster mobile app launch, but with an advertised 79% APY on USD, the tool is serving up some of the juiciest stablecoin yields available!

Today, we’re unpacking Blast Mobile to better understand the risk and reward profile of this brand new onchain yield opportunity! 👇

💥 Blast Mobile Basics

Blast is an Ethereum L2 built around the concept of “onchain rewards,” a unique focal point that its developers hoped would be a competitive edge to outpace rivals.

Despite lofty pre-launch ambitions for this project, Blast has done little besides disappoint since June, when the launch of its BLAST token at a dismally cheap valuation shattered airdrop farmer ambitions and caused its points program to fall out of favor with depositors.

Although Blast has provided automatic yield to ETH and USDB holders since its inception, the network has struggled to combat its declining token prices and tumbling user metrics. In an effort to reverse this trend, Blast’s long-awaited mobile app (launched on January 23) introduced revamped tokenomics and replaced the faltering points program with liquid BLAST token rewards.

Like its moniker suggests, the “Blast Mobile App” can be accessed through iOS and Android mobile devices. Once Blast Mobile has been installed to their device, users are prompted to create an account that is secured via “passkey,” a user-friendly wallet seedphrase format that is stored within the physical device and can be backed up to the “cloud,” making user login credentials twice-secured and extremely difficult to lose.

⚠️ It is worth noting that storing your seed phrase within a mobile device or cloud storage could result in the total loss of funds if a malicious actor compromises your device/account.

The rudimentary Blast Mobile interface is equipped with only four functions, and while it cannot be used to access third-party crypto protocols at this time (devs promise additional connectivity with Blast apps that should be easy to enable in the near future!), Blast Mobile’s “Earn” tab is the only button you’ll need to access lofty double-digit returns on stablecoins!

All USD stablecoins sent to Blast Mobile are converted into USDB – a Blast-native representation of MakerDAO’s staked DAI product – meaning that all depositors earn Blast-standard stablecoin yields (amounting to ~13% at the time of this analysis).

To boost their rewards rate, Blast Mobile users can optionally deposit BLAST tokens and receive up to a 6x yield multiplier. Achieving the maximum multiplier requires users to deposit at least 30% of their USDB balance in the Earn App worth of BLAST. This strategy returned ~78% annualized at the time of this analysis.

Every 6 hours, Blast Mobile Earn distributes liquid BLAST rewards to USDB depositors; USDB deposits and accrued BLAST rewards can be withdrawn at any time.

While allowing BLAST to accumulate will help increase the rewards rate for USDB depositors below the maximum boost threshold, their returns become stored in BLAST tokens, and therefore dependent on fluctuations in token price. There are no specifics on how long the Blast Mobile Earn incentives program will last, but lead Blast developer Pacman has disclaimed that they will not last forever.

 🧐 Conclusion

Blast Mobile’s Earn program dangles market-leading yields in front of depositors, but requires them to hold BLAST, a token which has fallen in price by over 80% since it was airdropped just 6 months ago. Although this design may work for the few BLAST bulls out there, it comes with an unknown length and imposes directional price risks that could seriously complicate depositor dollar-denominated returns if BLAST can't hold it together.