I’ll admit. That’s a click-baity title (ew) and I will probably be wrong about everyone talking about Blast next week.

That said, I believe Blast is underappreciated in certain circles and I want to bring it to your attention, regardless of your web3 knowledge level or particular areas of interest. Qiao Wang of Alliance DAO put it best:

And I think the degen arena is oftentimes where the most interesting things live.

If you’ve been reading this newsletter for some time, you may have caught a casual mention or two about Blast in the past. A quick recap:

• Layer 2 blockchain that provides native yield (you can earn 4% or 5% just by holding Ethereum or stablecoins on the Blast blockchain, respectively)

• Raised $20M in funding

• Founded by Pacman, who also is the founder of Blur, the leading ETH NFT marketplace

• Blur’s rewards program is now intertwined with Blast’s rewards program

You can learn more about Blast through their intro announcement or Zeneca’s in-depth breakdown.

Explaining Blast in a way we can understand better — Imagine Bank of America (or your preferred bank) launched a ‘SUPER DUPER’ checking account with:

• 4.5% APR

• Earn points on all transactions, no limit

• No minimums or fees

• You get a points multiplier by referring friends and family

Sounds pretty good right? Almost…too good?

When the Layer 2 was announced in late November, it deservedly received a fair amount of criticism.

The bridge to Blast was a one-way bridge (what if they get hacked? what if they run away with all the bridged funds? why bridge over when there are better opportunities elsewhere?) with funds that can’t be transferred out, and funds were initially stored on a multi-sig wallet (the blockchain wasn’t built yet at the time of the announcement).

As concerns and criticisms about Blast from November eventually faded away, where are we 3 months later? Let’s check the scoreboard.

Degens are gonna degen, myself included 🤦‍♂️

We have almost 150,000 wallets that have bridged over nearly $2 BILLION (645,000+ ETH) to Blast. You can track the metrics here.

The steady growth in TVL (total value locked) and users simply became too large to ignore.

A couple months after the Blast announcement, the team announced that the Blast Testnet was live, along with the BIG BANG competition.

TLDR on BIG BANG:

• When Blast Mainnet goes live at the end of February, the ETH bridged over will unlock and builders will be able to fight for attention, users, and most importantly, $2 billion in capital

• Winning projects will be promoted to the Blast community

• 50% of the Blast airdrop will be allocated to developers as an incentive to build on Blast. The airdrop can be used to incentivize growth for their projects.

• Blast will also help winners connect with judges and investors

• Specific areas of focus include DEXes (decentralized exchanges), lending, NFTs, gaming, SocialFi, and infrastructure

Even if you’re skeptical of Blast, it’s hard to deny the attention it has received from builders across the ecosystem.

Over 3,000 teams registered for the competition and 60+ hours of videos were submitted for the judges to review. Submission videos are 3 minutes max, so over 1,200 projects will be ready for the Blast Mainnet launch or soon after. Many won’t succeed, but if we’re playing a numbers game, there will be at least a few ‘bang’ers 😉

It’s important to note that a number of these projects have already been building or existed prior to Blast. However, the fact that they are building for Blast is a positive signal and a nod to the unique attributes that the blockchain provides (native yield, transparent confirmation that there will be an airdrop).

As the Blast ecosystem gears up for launch, many projects have kicked off their marketing efforts to acquire early users to stress-test their products.

As a result, X Spaces, threads on interesting Blast projects, and ecosystem maps have popped up with regularity on the feed, and conversations about different projects on Blast have sprouted up in DMs and groupchats.

An ecosystem map showing only a fraction of all the projects launching on Blast

Are you still confused about Blast? I am, so share this with someone who’s smart!

So what do we have?

• A Layer 2 blockchain with faster and cheaper transactions

• $2 billion ready to be unlocked by the end of the month

• Hundreds of projects launching in the coming weeks

• A unique mechanic of native yield

• A confirmed ecosystem airdrop split between users that bridged over and teams building on Blast

And don’t forget:

If we were to put this into a flywheel we get something like this and IMO it’s impressive:

With this progression, we have a better idea of how growth and retention could be sustainable on Blast, with the airdrop, BIG BANG competition, and native yield playing their respective parts in the ‘pre-pre’ launch, pre-launch, and post-launch.

We’ll see how the dust settles with Blast in the coming weeks, but I’m interested to see how the blockchain, builders, and unique features of the blockchain come together in the early innings.

What happens to the TVL and user base?

Will the $2 billion and 150k users grow thanks to the positive flywheel effect, or will these users put their capital elsewhere as more interesting opportunities arise?

My gut tells me that these numbers will increase as a number of projects start to gain product-market fit.

Native yield: Blast’s killer feature

Although Blast’s native yield is just one piece of the flywheel, I believe it is one of the most important ones:

• Unique and novel differentiator in an increasingly crowded L2 ecosystem

• It directly supports builders and projects financially, which can also be passed down to their user base

• Supercharges the short and longterm user incentives

  • Short-term: Blast airdrop

  • Long-term: Project’s native points + eventual token if they have one

  • Short and long-term: Native yield

The Big Bang competition website has an ideas section to help provide inspiration to teams of what is possible with the new feature of native yield.

Many of these ideas are ‘X (which already exists) with native yield doing Y’, but sometimes that’s all it takes.

Could other L2’s copy this killer feature? Sure.

Problem is Blur has the first-mover advantage, sucked up all the developer talent, and is establishing an ecosystem that has a decent chance of sticking around.

Participating on Blast in different ways

A smaller and notable flywheel is happening in background for those with deeper pockets. They’ve bridged over a significant amount of funds to earn airdrop points, are participating in the projects, and they’re investing directly in projects building on Blast.

An example of this is @Christianeth:

When you have people like Christian investing in the ecosystem, the flywheel spins even more aggressively. We can confidently predict what he’ll be posting about to his 29k followers over the next few weeks, and he won’t be the only one.

So if you see Blast in the web3 headlines or on your timeline next week, you’ll know why. And if you don’t, well at least you know what Blast is and why it’s interesting 💥

See you next week!