What Is Layer-2 Blast? The Rewards System That Sparked Controversy

On November 21st crypto Twitter was Flooded with referral links to a brand New ethereum layer 2 blockchain funded To the tune of $20 million by Paradigm And standard crypto among others blast Launch took the crypto Community by Storm this was in part due to the L2 Being founded by Pacman the MIT Dropout Who launched NFD Marketplace blur which Overtook openc in market share however The hype was largely due to what is Essentially a lock drop so this is users Who bridge eth over to blast and Complete other actions like referring New users to earn Reward Points which Eventually are converted to a token Airdrop so in just over a week Blast has Already garnered a whopping $611 million In deposits surpassing the total value Locked toward tvl on coinbase's L2 base Which launched earlier in August but This caused concerns within the crypto Community even from lead investor Paradigm what exactly is blast and what Are the controversies let's dive into it In this video so first of all what is Blast launch by blur founder Pac-Man Blast was designed with the belief that Markets and P liquidity will move Towards places with the highest yield More specifically blast believes in Leveraging the concept of risk-free Yield a term which also Drew Controversies to attract users to its

Chain in the traditional Finance world The risk-free rate refers to the yield Derived from short-term treasury bills According to Pac-Man this has come to Refer to the staking yield derived from Eth staking in fact eth staking has Grown so significantly that it has since Become the largest defi sub sector Hoarding $26 billion in TBL across more Than 120 protocols blast takes this one Step further to bring the risk for yield Natively to the L2 level granting to Their users native yield on assets Bridge onto the chain and so put simply E held on blast will automatically Compound based on the eth staking yield Currently 4% directly to the user's Wallet so you might be asking where does The yield come from well when users Bridge eth or weth tokens onto the chain These eth tokens are staked on the Ethereum mainten end starting with the Leading liquid staking protocol Lio Finance through Lido's rebasing Mechanism yield is passed to users on The L2 the current adverti yield for Each deposits is 4% stable coins are Also available with usdc usdt and die Available as options these stable coins Are deposited into tokenized treasury Build products starting with maker down In return depositors receive blast USD Or usdb and a 5% yield on their assets Usdb will be redeemable for usdc once it

Is bridged back to the ethereum mate and Of course there's just one thing all Deposits are locked for 3 months in a Bridge contract until February of 2024 When the blast mainnet is expected to Launch everyone knows that 3 months in Crypto is an eternity though which leads Us to blast airdrop and reward model Let's talk about blast rewards and the Airdrop blast is currently in Early Access with new users requiring an Invite link to begin depositing into Blast however fret not several whales And influencers have already received Unlimited invites which can be used more Than once making it trivial for new Users to access the platform once users Connect their Twitter and Discord Accounts They will receive an initial Set of points based on their wallet's Historical activity holders of the blur Token as well as nft Traders on blur Will also be grining blast points during Blur season 3 which will last from November of 2023 to May of 2024 finally Additional points will be granted based On the deposits made to the platform With a larger deposits yielding more Points users get one free Spin to earn Extra points and another if they make a Tweet about Blast from their connected Twitter account based on their deposited Amount users will also earn additional Spins with every one e worth of deposits

Earning one spin per week so once users Have onboarded they will be granted Invite links to let their friends enter The platform too each of your direct Invites will earn you an additional 16% Bonus points on the points that they Earn and the direct invites of these Direct invites will earn you an Additional 8% in bonus points on points That they earn moreover your direct Invites form a squad whereby the total Deposits of your squad are combined Towards a squad goal at Milestones such As 5 eth you will unlock more invite Links as well as a chance to spin for Improved luck this luck percentage Determines your chances of hitting a Super spin in your regular spins which Grants 10 times the normal rewards so Basically in short the bigger the whales That you invite the more points that you Are likely to receive the points Received from deposits spins and Squad Activity are expected to be redeemable In May of 2024 so now let's talk about The Controversies so surrounding blasts However since the launch of the blast Airdrop campaign the project has drawn Significant concerns for several of Their decisions so the first major Criticism is the lack of an actual L2 Chain although the blast campaign Markets the process of bridging onto

Blast there is no actual chain to bridge To and users are simply sending funds Into a smart contract which is Controlled by a 35ths multi- signature Wallet so this means that if three of These signers on the wallet are Compromised user deposits on blast smart Contracts could technically be drained Alternatively a simple collusion could Also achieve the same effect moreover Although there are five signers on the Multisig four of the five were actually Funded by the same wallet leading many To suspect them being owned by the same Person or entity if they were indeed Controlled by a single entity this makes It easy for a malicious actor to Compromise the multi-sig Via a simple Point of failure through fishing a third Criticism of the campaign was how Closely it resembled a pyramid scheme With many laminating the state of the Industry along with the project some Defended it however believing that it Was no different from most other Projects with the benefit that at least They were upfront about the degenerate Nature of the campaign another point of Contention arose due to the blast teams Solely relying on Lio Finance for the E Staking yield the move would further Increase the centralization surrounding Lido's share of e staking which has Already been discussed multiple times

Earlier in the year as a risk for the Network as a whole in fact Paradigm also Came forward to make a statement echoing The disagreement with the way that blast Was launched and also marketed Specifically the lock deposits and the Launch of a bridge contract before the L2 existed so with the markets heating Up and investors chasing the next Narrative blast is continuing to attract Attention and funds from the crypto Community furthermore the layer 2 space Is becoming increasingly competitive With numerous layer 2 main it launches From consensus coinbase B&B chain ZK Sync and more with the current success Of blur's vampire attack on openc could Pac-Man execute the same Playbook with Blast on leading l2s arbitrum and Optimism times will tell when the layer 2 Network launches in February of 2024 Let us know your thoughts in the Comments down below L