Controversial Ethereum Layer 2, Blast: Boon or Bane for Crypto Users?

By: Eliza Bennet

Blast, a recently launched Layer-2 blockchain set to go live in March, has swiftly managed to raise more than $225 million in staked assets since its initiation. Despite this staggering figure, the project faces scrutiny amidst allegations of being a pyramid scheme.

The new Ethereum Layer-2 network has quickly become the third-largest holder of staked ether, amassing over 140,000 Ethereum, valued approximately at $286 million, as per on-chain data. Aggregate assets held by the protocol's multi-sig wallet amount to more than $335 million, signifying a significant footprint in the current crypto landscape.

However, the Blast points system, which notably rewards early users based on the number of users they refer, has faced backlash from within the crypto community. The inflows into the protocol remain one-directional, with users unable to withdraw until February next year. Crypto investment firm MoonRock Capital's CEO and managing partner dubbed this aspect as 'Ponzi airdrop farming'. Furthermore, concerns have also been raised over the anonymity of the addresses associated with the protocol's multi-sig wallet.

Despite the inherent risks, some experts in the field doubt the possibility of fund theft and the criticism has not deterred the rapid growth of Blast over a short period.