Blast: Start a New Era of Layer 2 Earnings

On the evening of June 26, Blast airdropped $Blast tokens to the community, marking the conclusion of this highly anticipated airdrop event. As a top project this year alongside ZKsync, Blast has performed excellently in terms of investment institutions, community enthusiasm, and TVL. With Layer 2 entering a new stage, the future development of Blast and the entire Layer 2 ecosystem is worth paying attention to.

1. Project Background

Environment-driven innovation

In traditional Layer 2 ecosystems, users earn ecosystem tokens as rewards by staking, while project teams use the staked funds for POS transaction verification. Since Layer 2 is built on top of Layer 1, the staked funds bear dual system risks, which is why Layer 2 projects typically offer higher staking rates. For example, the annual interest rate for Matic on the Polygon network can reach 8%-14%, while the annual interest rate for ETH on the ETH network is generally 4%-7%. Blast was born to further enhance capital returns for Layer 2.

Basic Information

Blast is an Ethereum Layer 2 network based on Optimistic Rollups launched by PacMan, the founder of Blur. Unlike other Layer 2 projects that focus on scalability, speed, and cost reduction, Blast is dedicated to improving the shortcomings of Layer 1 while providing higher economic benefits. It is the first Layer 2 to offer fixed income for ETH and stablecoin staking, redirecting the development of Layer 2 from technical attributes back to the financial essence of Web3.

Development History

In November 2023, Blast launched and secured $20 million in seed round financing. It then announced its unique revenue model, offering 4% ETH returns and 5% stablecoin returns. The mainnet officially went live in February 2024, and an airdrop plan was announced in May, with the airdrop executed on June 26.

market growth

Blast Chain is highly favored in the market, with its TVL reaching 1.6 billion USD, making it the 6th ranked chain in terms of TVL, accounting for 1.71% of all assets locked on chains.

2. Token Economics

Token Function

$Blast token has basic functions such as ecological governance, airdrop incentives, and staking rewards, and is relatively complete in terms of ecological governance.

Token Distribution

The total supply of Blast tokens is 10 billion, of which:

• Community receives 50%, linear unlocking over 3 years
• Core contributors receive 25.5%, with phased unlocking.
• Investors receive 16.5%, unlocked in phases.
• The Blast Foundation will receive 8%, unlocked linearly over 4 years.

Phase One Airdrop

• Blast Points and Blast Goal holders will each share 7% of the airdrop rewards.
• The Blur Foundation receives a 3% airdrop reward for distribution to the Blur community.
• Airdrop for wallets in the top 0.1% will be released linearly over 6 months.

3. Narrative Characteristics

Perfect EVM Compatibility

Blast adopts a free choice of "whether to Auto-Rebasing" to achieve perfect EVM compatibility, making it easy for DAPP to migrate.

A perfect solution for one fish to eat multiple times.

Blast achieves native yields on ETH and stablecoins through the Auto-Rebasing( automatic rebase) program. Users can automatically earn yields without any operation, avoiding high gas fees. Blast will automatically lock funds for staking in DeFi platforms like Lido, MakerDAO, etc., enabling compound interest operations.

4. Ecological Construction

The Blast ecosystem covers multiple tracks including SocialFi, GameFi, DeFi, and NFTs, forming a diversified ecosystem.

DEX Leader Thruster

Thruster is a yield-focused DEX designed for users, with a TVL of $438 million. It inherits the AMM model, providing both simple and complex mode UIs, and utilizes the Blast chain to automate staking yields to enhance liquidity and trading efficiency.

Leverage Lending Leader Juice Finance

Juice Finance is the largest leveraged lending platform on the Blast chain, with a TVL of $394 million. It offers lending and yield farming features, integrating the Blast native rebased token and gas refund mechanism to optimize user returns.

Capital effect enhances platform Zest

Zest utilizes the native ETH yield of the Blast chain to enhance capital efficiency, providing users with higher returns and lower risk auxiliary solutions.

SocialFi leader Fantasy

Fantasy is an innovative social finance trading card game that combines elements of social finance and trading card games. Its total NFT trading volume has reached $93.11 million, with over 36,700 participants.

V. Future Development and Risk Opinions

Future Development Trends

• Blast is expected to become a symbolic project, continuously attracting funds from other chains.
• Blast provides fertile ground for the development of DeFi and is expected to promote the rapid growth of DeFi projects.

Risk Analysis of Privacy

• Blast achieves automated staking through Auto-Rebasing, optimizing capital efficiency.
• Staking through Lido and MakerDAO may increase systemic risk across the entire blockchain.
• Automatic staking behavior may involve issues related to the disposal rights of user funds.

Overall, the high returns of Blast come with increased systemic risk, but it remains attractive to individual small investors. Its return characteristics may be adopted by other Layer 2s, and it is worth ongoing attention.