Blast Network Soars to $400M TVL Amidst Centralization Concerns
The post Blast Network Soars to $400M TVL Amidst Centralization Concerns appeared first on Coinpedia Fintech News
In a recent social media discussion, Jarrod Watts, a developer relations engineer at Polygon Labs, raised significant concerns about the security and decentralization of the newly launched Blast API network. On November 23, Watts argued that Blast’s centralization could pose serious security risks to its users.
Allegations Against Blast API
Watts’s critique began with a claim that Blast operates on a “3/5 multisig” system. This means that transactions can be executed if three out of five designated team members agree. According to Watts, this setup makes Blast vulnerable, as an attacker only needs to compromise the keys of three team members to seize control of all cryptocurrency deposited in the team’s contracts.
Let’s start at the beginning.
A fresh wallet, 0x52c31 deploys two contracts:
1/ 0xa01: The Blast Deposit Proxy Contract
2/ 0x5f6: The Blast Deposit Implementation Contract
If you aren’t familiar with these “proxy contract” setups, np, we’ll come back to this later.
(1/24) pic.twitter.com/dd9y2AaRRd
— Jarrod Watts (@jarrodWattsDev) November 23, 2023
Watts supplemented his allegations with twenty-four additional posts, including graphics to further detail his analysis of the Blast API. He explained that a new wallet, 0x52c31, was used to deposit two “proxy contracts,” which were then transferred to a Gnosis Safe smart contract.
Gnosis Safe contracts are known for their reliability in multi-signature security. However, Watts pointed out that the five signers of the Safe contract controlling the Blast contracts are anonymous and newly created, casting doubt on the network’s security.
Furthermore, Watts asserted that Blast does not qualify as a Layer 2 (L2) network. He claimed that the Blast smart contract merely accepts user funds and stakes them in other protocols like LIDO, without offering features typical of an L2, such as a testnet, transactions, a bridge, a rollup, or sending transaction data to Ethereum.
Blast Team’s Response
On multisig security.
Read this thread to understand the security model of Blast along with other L2s like Arbitrum, Optimism, and Polygon.
— Blast (@Blast_L2) November 24, 2023
The Blast team did not address Watts’ thread in response to these allegations. Instead, in a separate discussion, they claimed that Blast’s decentralization is comparable to other Layer 2 solutions, such as Polygon, Arbitrum, and Optimism.
Blast Network’s marketing materials describe it as “the only Ethereum L2 with native yield for ETH and stablecoins.” The website further explains that stablecoins deposited in Blast are converted to “USDB,” a stablecoin that compounds using MakerDAO’s T-Bill protocol. This allows users to auto-compound their balances.
However, the Blast team has yet to release technical documentation detailing the protocol’s operations. They have announced that these documents will be made public alongside an airdrop scheduled for January.
Conclusion
The debate between Jarrod Watts and the Blast team highlights ongoing concerns in the cryptocurrency community regarding security and decentralization, especially in emerging networks. As the situation unfolds, the cryptocurrency community awaits further details and technical insights from the Blast team.
Filed under: Bitcoin - @ November 25, 2023 7:02 am