Ethereum Layer 2 Blast is ‘Not an L2’ Says Polygon Dev, Locks $335 Million in Days
The alleged “only L2 with native yield for ETH and stablecoins” says it will launch its mainnet launch in February 2024.
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A new Ethereum project called Blast was announced on Monday claiming to be a Layer 2 network and promoting attractive staking yields. However, Polygon protocol engineer Jarrod Watts has called into question Blast’s legitimacy, stating it is “not an L2.”
According to DefiLlama data, Blast has locked over $335 million in ETH and DAI in the last few days.
Blast is not an L2.
The Blast smart contract:
1/ Accepts funds from users.
2/ Stakes users' funds into protocols like LIDO.
There's no testnet, no transactions, no bridge, no rollup, and no sending of transaction data to Ethereum.
It's not an L2.
— Jarrod Watts (@jarrodWattsDev) November 23, 2023
Watts outlined multiple issues on Twitter, that Blast currently has no operational network for transactions or bridges back to Ethereum. Instead, the Blast smart contract accepts user deposits and stakes them into Lido ETH staking and MakerDAO’s on-chain T-Bill protocol to generate yield.
Blast is backed by major VC firms like Paradigm and influencers in the crypto space. However, users must trust that Blast’s team of pseudonymous and mostly unknown developers will eventually build the promised technology to unlock deposits.
Watts showed the bridge could be set to any basic contract, which would then have access to all $335 million in staked assets. The contract is controlled by a multi-signature wallet held by 5 newly-created addresses.
While admitting the chances of an exploit seem low, Watts concluded “If I had to guess, I don’t think the funds will be stolen.”