Layer-2 network Blast becomes third-largest holder of staked Ethereum amid pyramid scheme allegations

Blast, a recently introduced Ethereum (ETH) layer-2 web promising “native yield” connected ETH and stablecoin holdings, swiftly secured the presumption of the third-largest holder of staked ether successful conscionable 3 days post-launch, according to on-chain data.

Etherscan data indicates that the level has amassed implicit 140,000 staked Ethereum, valued astatine astir $286 million, utilizing the liquid staking protocol Lido since its inception connected Nov. 20. This accumulation represents astir 1.5% of the full staked Ether volume.

Debank’s data further shows that the protocol’s multi-sig wallet presently holds assets worthy much than $335 million, comprising Lido’s staked Ether and MakerDAO’s stablecoin DAI.

Controversy Surrounds Blast’s Pyramid-Like System

However, the accelerated maturation of Blast implicit the past 3 days has triggered beardown disapproval wrong the crypto assemblage owed to its pyramid-like Blast points system, which rewards aboriginal users based connected the fig of users they refer.

Details connected the project’s website outline that users person an further 16% of points erstwhile their referrals bring successful much participants and an other 8% if the consequent level brings successful further users.

An intriguing facet is that the inflows into the protocol stay one-directional, with nary enactment for withdrawal until its slated motorboat successful February adjacent year.

Simon Dedic, the CEO and managing spouse of crypto concern steadfast MoonRock Capital, stated that Blast’s unsocial selling constituent is its “Ponzi airdrop farming.” He added:

“[To beryllium honest] Blast_L2 is the cleanable illustration of wherefore non-crypto radical hatred Web3. [It is not]a method advancement to immoderate of the different L2s, nor does it connection immoderate breathtaking applications to usage connected apical of it. While disabling withdrawals.”

Besides its Ponzi-like structure, attraction has been drawn to Blast’s multi-sig wallet.

Polygon technologist Jarrod Watts believes the protocol needs 3 retired of 5 signatories to authorize suspicious actions. Watts highlighted that the addresses associated are caller and person chartless identities.

However, contempt the inherent risks, Watts doubts the anticipation of money theft.

Similarly, Cos, the laminitis of SlowMist, noted that Blast operates arsenic an upgradeable declaration with a 3/5 multi-signature setup and lacks a clip lock.

The station Layer-2 web Blast becomes third-largest holder of staked Ethereum amid pyramid strategy allegations appeared archetypal connected CryptoSlate.