Unveiling Blast: Exploring the Concept, Mechanism, and Risks

First, the Blast project has emerged as a notable contender, promising a unique approach to decentralized finance. However, as time began to pass, many deficiencies began to emerge.

In this article, we delve into the concept behind Blast, unravel its workings, and cautiously examine the associated risks.

What is Blast?

Blast positions itself as an L2 blockchain with the primary goal of fostering financial inclusion through a community-driven platform. Right now, it’s in the early access phase of its airdrop and you need an invite code to enter.

They call themselves as “the only Ethereum L2 with native yield for ETH and stablecoins” and the project is backed by Paradigm and Standard Crypto. According to their website, their objective is to expand the on-chain economy while achieving the best yield. Users will have the opportunity to receive the Blast Airdrop.

Blast has reached $230 Million in TVL within 48 hours.

37,131 community members are now earning yield (~4% for ETH and 5% for stables) + Blast Points.

We can't wait to share more about what we're building for the Blast Community in future updates! pic.twitter.com/DiW2GT7cUe

— Blast (@Blast_L2) November 22, 2023

How Blast Works?

Blast has three parts:

• Auto Rebasing: Basta is 100% compatible with ERC-20 tokens, so you can pass them very easily.
• Staking: Blast is currently supported by Ethereum’s Shanghai update. To stake on Blast, ETH-assets are rebased on its chain which allows users to automatically receive the ETH yield from L1 staking. This was previously done by Lido.
• T-Bill Yield: Blast’s auto-rebasing stablecoin, USDB, is awarded to users who bridge stablecoins. The on-chain T-Bill protocol of MakerDAO provides the yield for USDB. Redeeming USDB for USDC is possible when returning to Ethereum via bridging.

Also, it’s important to say that Blast promises a 5% yield by staking USDB, its stablecoin. This is higher than the 4% dividend that Ethereum has with its latest upgrade.

Introducing Blast: The only Ethereum L2 with native yield for ETH and stablecoins.

We’ve raised $20m from @Paradigm and @StandardCrypto to build the L2 that helps you earn more.

Details on how to get early access at the end of the thread👇 pic.twitter.com/AYYmK8YFx4

— Blast (@Blast_L2) November 20, 2023

Now that this project is in its early access, there are some people that are testing the dapp and have some things to say.

Risks Associated with Blast

• Lack of Docs: As you can see on its website, this project has no Whitepaper, only an “about” section where they explain the project in general terms.
• No Ecosystem: This platform doesn’t have an explorer where you can see its on-chain transactions. Also, there are no compatible wallets, bridges, or oracles. In other words, you won’t find enough tools to interact with the platform.
• Unclear Airdrop Roadmap: Because is in its airdrop phase, there are no exact dates to receive the airdrop. One early adopter said that their first date was for February 2024 and then they changed to May 2024. In other words, you need to deposit your ETH now, but you don’t know when you’ll receive your rewards.
• An unreliable pyramid scheme: Apart from getting rewards for your staked ETH, you get more if you invite people to use the platform. Also, if a group of people deposits 20 ETH, you get a personal invite code which, in theory, lets you earn more rewards. This definitely does not look serious or sustainable.

What is @Blast_L2 & why you should be worried.

It's an "L2" built on top of ETH to take your money.

You deposit real ETH and get in exchange… wait for it…

POINTS! 🤣

Time for a thread on #Blast 🧵 (01/12) pic.twitter.com/IyRrKIRsSb

— Duo Nine ⚡ YCC (@DU09BTC) November 24, 2023

Conclusion

Blast is a project that does not show enough credibility, as its business model gives too much incentive to earn more rewards for inviting more people to use the project.

It is estimated that Blast already has 37k users who have handed over their ETH, which is very worrying for the industry as it shows that there are still many people who hand over their money without doing enough research. Hopefully, the project will live up to its projections, but it looks like it will not.

Disclaimer
The information discussed by Altcoin Buzz is not financial advice. This is for educational, entertainment, and informational purposes only. Any information or strategies are thoughts and opinions relevant to the accepted levels of risk tolerance of the writer/reviewers and their risk tolerance may be different than yours. We are not responsible for any losses that you may incur as a result of any investments directly or indirectly related to the information provided. Bitcoin and other cryptocurrencies are high-risk investments so please do your due diligence. Copyright Altcoin Buzz Pte Ltd.