Blast has caused quite a stir in the crypto community since its Early Access launch last Monday, November 21st.
Blast is a project that is destined to become a new second layer or L2 solution, which is focused on the scalability and speed of Ethereum. The developer Tieshun Roquerre, also known as Pacman and the same one who created the NFT market Blur, is the one behind this new project that is built on the second layer of Ethereum.
Roquerre introduced Blast last week, with a unique design that promises to boost market efficiency and also generate “native yield” for users who deposit liquidity using ethers or stablecoins.
According to Roquerre, Blast users who deposit liquidity can also receive BLAST points and participate in an airdrop coming next year.
It should be noted that Blast's mainnet is not live at the time of writing. However, the project has managed to attract a large number of interested parties, who are already depositing liquidity into its smart contract.
According to Blast's website, the total value staked, or TVL, in the contract is currently $537 million. In addition, the new project has over 60.000 users.
Although the project is barely a week old, it has attracted attention for its promise to revolutionize the throughput model in Ethereum's L2 ecosystem.
What is Blast?
Blast is a new blockchain built on Ethereum's second layer that promises faster, cheaper, and more secure transactions on the network.
In its funding round, which was completed in less than 48 hours, Blast managed to raise $20 million, with the participation of major investors such as Paradigm and Standard Crypto. This demonstrates the great interest that the market has in this new project, which promises to be innovative.
On the other hand, analysts estimated that if Blast managed to maintain the interest of crypto users and the growth rate it had shown in its early days, then it would manage to surpass Cardano, one of the main smart contract platforms, in terms of total value deposited or TVL, by the end of this week.
Today, the Cardano TVL is $263 million, according to data from Defi Llama, Blast has thus managed to reach an important milestone in the crypto industry.
The promise of native throughput on Ethereum
Blast aims to transform the staking mechanism with ether, Ethereum's native cryptocurrency. As the project explains, the goal is to generate returns through staking platforms such as Lido and MakerDAO's T-Bill protocol, to return said returns directly to users who deposit liquidity.
By using Blast, users can send ETH to Layer 2 and receive ETHB, a token that reflects the value and yield of ETH staked on a Layer 1 staking protocol like Lido). This way, users can enjoy fast and cheap transactions on Layer 2 without losing the rewards generated by staking on Layer 1.
In addition to this, Blast aims to bring real-world assets (RWA) to the ETH staking ecosystem, offering its customers the ability to deposit stablecoins and receive USDB. The latter is a token backed by the MakerDAO protocol and is pegged to the yield of 10-year US Treasury bonds, providing a more stable and passive source of income for Blast users.
Overall, Blast aims to offer a more inclusive and profitable staking solution for ETH and stablecoin holders, allowing them to earn better rewards for contributing to the security and development of the blockchain network.
As for security, Blast explained in a thread on X (formerly Twitter) that this feature is guaranteed through a multisig controlled by 5 independent entities. Each key of the multisig is stored cold and is geographically separated from the other. “In the case of Blast, each signer has exactly those properties,” the project stated.
Who is behind the development of Blast?
The team bringing the new L2 Blast to life is led by the founder of the NFT marketplace Blur, and includes several members from the top 5 FAANG tech companies (Facebook, Amazon, Apple, Netflix, and Google), Yale University, Massachusetts Institute of Technology (MIT), Nanyang Technological University, Seoul National University, and others who have worked on some of the largest DeFi and Web3 protocols on the Ethereum and Solana networks.
Blast is also backed by renowned crypto industry investors and venture capital funds such as Paradigm, Standard Crypto and Primitive Ventures, as well as influential private investors such as Andrew Kang and Santiago Santos.
A roadmap for 2024
Blast developers will roll out the new L2 protocol in three stages, beginning with Early Access that went live on Monday, November 21.
In this first stage, the project's bridge contract was activated and the distribution of the points began. Blast PointsHowever, those interested in participating in Blast can only access the project by invitation.
On the other hand, the project plans to consolidate next year, according to the developers. The Blast mainnet is expected to be launched at the end of February, and with it, the withdrawal of ethers that are currently being deposited in the Blast smart contract will be enabled. By the end of May 2024, the developers of this L2 will enable the exchange of Blast Points and also plan to launch an airdrop, the conditions of which have not yet been confirmed or defined.
Concerns about Blast's safety are raised
Overall, while Blast seems like a promising project in the crypto industry, experts warn of the potential risks involved in a development project like this.
Jarrod Watts, an engineer at Polygon Labs, highlighted that the identities of the entities that make up Blast's multisig are unknown and that, in addition, all the addresses that make up this multisig are all new addresses. He also pointed out that the project does not have a test network and that it does not currently function as an L2, since it does not yet allow transactions or sending data to Ethereum.
Also, Yu Xian, founder of SlowMist, highlighted that Blast's smart contract is an upgradeable contract that is controlled by a 3-of-5 multisig and lacks a time lock, something that the project's developers justified on X.
Juan Aranovich, research director at Ryze Labs, noted that Blast’s rapid rise in a week has raised questions in the crypto community about its security and legal framework. Like Watts, Aranovich questioned the security risks associated with Blast’s multisig setup, which may allow access to funds deposited in its smart contract. In this regard, Watts specified that certain vulnerabilities in the “enableTransition” function and the “mainnetBridge” contract could, in theory, allow unrestricted access to ETH and DAI deposited in Blast.
Continue reading: Nexus, a layer 3 solution designed to unify Ethereum liquidity
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