$400M Locked in Layer-2 Blast Four Days After Launching, Lead Investor Paradigm Raises Concerns
Crypto News

$400M Locked in Layer-2 Blast Four Days After Launching, Lead Investor Paradigm Raises Concerns

2m
Created 4mo ago, last updated 4mo ago

Interest in the Ethereum layer-2 network Blast, set to launch in February next year, has led to an influx of funds.

$400M Locked in Layer-2 Blast Four Days After Launching, Lead Investor Paradigm Raises Concerns
Interest in the Ethereum layer-2 network Blast, set to launch in February next year, has led to an influx of funds. Within days of its announcement, the project has amassed over $405 million in total value locked (TVL), with significant growth anticipated.

Led by Tieshun "Pacman" Roquerre, co-founder of Blur, a prominent NFT marketplace, Blast intends to offer rewards to users who deposit crypto, primarily staked Ethereum (ETH) and stablecoins. Blast plans to retain user funds until its bridge goes live in February, raising security concerns.

However, critics have questioned Blast's model, with suggestions of it potentially resembling a Ponzi scheme. The project is also offering "risk-free" yields of 4% in ETH and 5% on stablecoins, alongside concerns about requiring multiple anonymous keys to execute transactions.

View post on Twitter

Pacman defended the project, highlighting that the attractive yield is derived from established decentralized finance projects like Lido and MakerDAO. However, skeptics argue that no form of staking is entirely "risk-free.”

Meanwhile, crypto venture capital firm Paradigm, a seed investor in Blast, has also voiced its criticism of Blast's marketing strategy and protocol execution, stating that the startup has "crossed lines" in both aspects. Paradigm expressed its disagreement with the decision to launch a bridge before the layer-2 network and the three-month withdrawal restriction imposed by Blast.

View post on Twitter

Dan Robinson, the head of research at Paradigm, mentioned that these actions set a negative precedent and undermine the work of a serious team. Robinson emphasized that Paradigm invests in independent founders, even if disagreements arise, but the firm takes its responsibility in the crypto ecosystem seriously and does not endorse such tactics.

Let us know what you loved about this article, what could be improved, or share any other feedback by filling out this short form.

This article contains links to third-party websites or other content for information purposes only (“Third-Party Sites”). The Third-Party Sites are not under the control of CoinMarketCap, and CoinMarketCap is not responsible for the content of any Third-Party Site, including without limitation any link contained in a Third-Party Site, or any changes or updates to a Third-Party Site. CoinMarketCap is providing these links to you only as a convenience, and the inclusion of any link does not imply endorsement, approval or recommendation by CoinMarketCap of the site or any association with its operators. This article is intended to be used and must be used for informational purposes only. It is important to do your own research and analysis before making any material decisions related to any of the products or services described. This article is not intended as, and shall not be construed as, financial advice. The views and opinions expressed in this article are the author’s [company’s] own and do not necessarily reflect those of CoinMarketCap.
0 people liked this article