The Ethereum L2 with native yield that you never knew you needed blasted off last week!
Headed by PacmanBlur (the mastermind behind NFT marketplace Blur) and supported by reputable crypto venture shops Paradigm and Standard Crypto, Blast launched into widespread acclaim from Crypto Twitter (CT) influencers, many of whom were also backers of the project.
Blast’s launch strategy is not dissimilar from that of friend.tech, the social-fi protocol that allows you to purchase “keys” into private chat rooms, with both platforms relying heavily on point-incentivized referral systems.
On Tuesday, the project’s TVL surpassed that of alt-L1 darling Solana, but while TVL is off to a strong start, the team’s tactics have caused Blast to run afoul of not only anons on CT, but also their Paradigm backers.
There are a lot of components of Blast that I’m excited about and would be interested in engaging with people on. That said, we at Paradigm think the announcement this week crossed lines in both messaging and execution. For example, we don’t agree with the decision to launch the…
— Dan Robinson (@danrobinson) November 26, 2023
Some detest the mere incentivization of deposits with points, but much of the outcry is centered around the fact that Blast has not actually deployed, meaning depositors to Blast’s early access program are simply entrusting their funds to a multi-sig without an actual chain attached to it.
Further aggravating the masses is Blast’s one-way nature; deposits are locked until the chain hits mainnet in February 2024.
Others have found flaws with the chain’s ingrained yield generation mechanics and question its core value proposition. They believe that users should retain the choice to select the risk profiles of their assets and oppose Blast’s method of delivering native yields.
This is a very bad idea. ETH and liquid staking derivatives are different assets with different risk profiles (and rewards), and users should have a choice about which one they want to use. The same is true for different types of stablecoins https://t.co/zHYD4QzgLV
— Dankrad Feist (@dankrad) November 21, 2023
Undoubtedly, Blast rubbed many on Crypto Twitter the wrong way, but is the disapproval deserved? Critics chastised Blast for being a multi-sig, but all major L2s rely on one.
🗣️ Why is it problematic for Blast to take the same centralization shortcut?
Numerous other crypto projects, like EigenLayer and Diva, have constructed vaults to accumulate TVL prior to the mainnet launch of their products.
🗣️ Why should Blast be penalized for doing the same?
Utilization of a points system allows Blast to incentivize users to take actions that are most valuable to its success and makes any future airdrop distributions more equitable by clearly specifying the reward for given actions.
🗣️ What’s wrong with aligning interests with incentives in the pre-token phase?
Critics see Blast’s decision to implement native yield at the base layer as “a very bad idea,” but a more accurate categorization is “tradeoff.” Acquiring yield on crypto assets requires some level of technical sophistication; perhaps there will be demand for simplified yield products.
🗣️ Who are we to discount the value of this innovation before Blast is even put to the test?
Despite the storm of criticism, the sheer amount of capital deposited into the Blast smart contract speaks volumes about the interest and belief of early participants. With over $600M already deposited into the Blast smart contract, it’s the second-largest rollup by TVL!
While skepticism lingers, the significant TVL garnered by Blast will likely translate into a high valuation come launch, and depositing now could result in a lucrative payday come airdrop 🪂
Eager to Blast off?
While there are certainly plenty of risk factors worth measuring against, we've added Blast to our Airdrop Hunter app with Quests to guide our paying members through likely qualifying steps.
