$1.7 billion withdrawn from Blast layer-2 after launch
Investors have withdrawn $1.7 billion worth of Ether from the Blast blockchain, a layer-2 network on Ethereum. This withdrawal, which constitutes the majority of assets, took place within the first 24 hours after the network’s launch. Prior to going live, Blast had gained attention by offering native yield on the Ethereum L2 and had accumulated over $2 billion in deposits through points farming.
Despite the initial excitement, the network experienced significant outflows, with the balance of the Blast bridge contract decreasing by around 70%. However, not all funds are leaving the network, as some are being transferred into Blast’s ETH Yield Manager Proxy, indicating a movement of capital within the ecosystem.
The launch of Blast was not without controversy. Due to the optimistic rollup design, there is a 14-day waiting period and Ethereum gas fees for withdrawals back to the mainnet, a detail that some investors claim to have been unaware of. Furthermore, the network has already witnessed its first exit scam, with the protocol called ‘RiskOnBlast’ disappearing along with $1.3 million worth of Ether.
The journey of Blast from a deposit-gathering initiative to a live network has been divisive. Critics have compared its deposit-only bridge to a pyramid scheme, while supporters have praised its potential to enhance Ethereum’s scalability.
Despite the challenges, Blast has managed to retain significant deposits, potentially positioning itself as the third-largest layer-2 network on Ethereum. The project, backed by Paradigm and led by NFT decentralized application Blur founder Tieshun Roquerre, has been both a marketing success and a target for criticism due to delays in transitioning from a concept to a functional project.
With over 85,000 accounts in its Discord community and 57,000 wallets interacting with the chain since its launch, Blast’s ecosystem continues to grow, even amidst concerns about the viability and security of new projects within its network.
