Blast Controversy Summary | Paradigm Supports Team Independence Despite Disagreement

Since last week, the launch of Layer2 network Blast by Blur has attracted market attention, with its technology and marketing strategies sparking controversy. Paradigm, the venture capital firm that invested in Blast, stated yesterday that "Blast has crossed the line, but ultimately respects the team's decision."

What Controversies Surround Blast

What is Blast

NFT decentralized exchange founder Pacman launched a new Layer2 network, Blast, last week, featuring "on-chain native yields" that provide secure interest rates for on-chain user assets.

When users deposit ETH or stablecoins in bulk into Blast, the Blast team will deposit the user's assets on Ethereum into Lido or MakerDAO, meaning that users enjoy the basic interest rate on their assets while operating DAPP on Blast, improving capital utilization efficiency.

Due to its unique native interest rate mechanism, coupled with the use of Blur's previous market hype point system, Blast's Total Value Locked (TVL) had exceeded $500 million as of earlier, ranking among the top five Layer2 projects at this stage in the Layer2 ecosystem.

Technical Controversies of Blast

Blast has faced much criticism. Several obvious issues can be found in the above mechanism, such as the Blast team having multi-signature control rights to move funds to Lido, raising security concerns. Moreover, Blast has not yet implemented the Rollup mechanism and is merely a smart contract for deposits.

Polygon Labs engineer Jarrod Watts tweetedstating that Blast is only a contract controlled by a 3/5 multisig wallet. Although other L2 projects have similar issues, Blast currently lacks a testnet, no transactions on it, no cross-chain bridges, no rollup, and does not even allow user withdrawal contracts. Jarrod Watts believes that Blast cannot currently be called L2.

EvilCos, founder of SlowMist, alsobelieves that Blast has serious security issues behind it, as the contract can be upgraded to change the logic, but the multisig holders behind it are not public.

The community has criticized Blast's technical architecture as overly simplistic, with most designs contradicting the decentralized concept, yet it has successfully attracted the market, sparking discussions on the necessity of decentralization and security once again.

OffChain Labs founder Steven Goldfeder described Blast as a monster, stating that the term L2 has been misused.

Marketing Controversies of Blast

Blast has successfully attracted funds in a short period, not only due to its unique interest rate mechanism but also relying on a point system similar to Blur. Users who deposit assets into Blast can also earn points and have the opportunity for future airdrop rewards, effectively capturing market sentiment.

However, such point systems have long been criticized for failing to attract genuine users, with most of Blur's current trading volume still filled with many buy and sell orders for the purpose of earning points.

Furthermore, the Blast invitation code mechanism makes the business model resemble a pyramid scheme. In response to various community concerns, founder Pacman also posted an explanation to alleviate doubts.

Paradigm's Perspective

Disagreement with Many Practices of Blast

Facing a project with numerous controversies, the professionalism and philosophy of the investment firm Paradigm have also come under scrutiny. Therefore, yesterday, Paradigm team member Dan Robinson posted stating that the Blast team had indeed overstepped the boundaries in information dissemination and execution.

It seems that Paradigm and the Blast team have many ideological differences. For example, Paradigm disagrees with launching the mainnetBridge before the Layer2 network to allocate funds to other protocols and questions why user withdrawals have not yet been enabled.

Paradigm believes that Blast sets a bad precedent for other projects and that most marketing activities at this stage will reduce the team's efficiency.

Still Supporting Pacman's Exploration Efforts

Despite many conflicting ideas, Paradigm will still choose to support Pacman and his team. Paradigm stated that this is not the first time they have invested in these individuals, having seen the capabilities and talents of the Pacman team in past projects like Namebase, Blur, and Blend.

When Pacman expressed a vision for expanding Blur on L2 and strengthening the product on existing foundations, Paradigm chose to invest in him again, stating that they are world-class developers who can bring value to the industry.

Paradigm has been discussing the above issues with the Blast team. While not endorsing such strategies, Paradigm takes its responsibility within the ecosystem seriously and expresses its opinions.

The Importance of Independent Thinking

After the first successful entry into the market, Blast faces many challenges in how to grow and operate sustainably amid controversies. The team's next steps will be closely watched.

It is believed that various opinions from project teams, professional venture capitalists, community feedback, market sentiment, and other aspects should be correctly and objectively considered.

In addition to seeing surface-level actions, it is also important to think about the motives behind various statements, so as to think more clearly and see the full picture of events, ultimately making judgments and taking responsibility for one's actions. The ability to think independently is crucial in the Web3 ecosystem.