The Difficult Decision of Shutting Down Blum & BOMB Chain
BOMB Community — I’ve decided that I need to write a blog post detailing reasons for a big decision to discontinue Blum Finance & BOMB Chain. I have reviewed a list of questions from the community, and will try my best to cover them in this post. Anything that is not clear or wasn’t answered, please ask at our Twitter Space AMA on Friday the 30th at 1PM EST.
Firstly, I want to apologize to anyone who I have disappointed with this decision. I am so thankful for all the support the community has provided ever since the original launch of OG BOMB, and throughout our journey since then.
The most difficult part of all of this is the feeling that I have let people down — people who believed in me from the beginning and stuck with me through the entire journey.
I am still a strong believer in crypto, PegHub, and I look forward to the seigniorage protocols hopefully becoming healthy when crypto markets pick up.
The Difficulties of Running a Seigniorage Protocol
The entire purpose of the BOMB App, later rebranded to Blum, was to bring inflows to our seigniorage protocols. Seigniorage protocols / TOMB forks have become near impossible to run successfully, which is a contrast from when OG Bomb launched. When OG Bomb launched, we were the only (to my knowledge) fork of Tomb finance. These protocols require community participation and the community working as a unit to do what is best for everyones long term success.
BOMB & BOMB Community did a great job of this at first. There were numerous challenges after launch, some more impactful than others. These challenges not only impacted BOMB, but all other seigniorage protocols (CZPEGS, bitBOMB, Snowpegs, Polypegs):
- Bear market where even the largest cryptos had huge price drops. DeFi, in general, dropped more than the blue chip cryptos, making it a very difficult environment to have success in.
- Terra Luna implosion cast a cloud over algocoins. Headlines stating algocoins were never going to work, among other negative news, really hurt this sector of DeFi, and it has not recovered since.
- BOMB being the first fork of Tomb finance, it was one of the best money making opportunities in all of DeFi. Once the 2,000+ BOMB/Tomb forks started rolling out, a lot of BOMB investors started chasing higher yields on freshly launched protocols. Without a strong community of loyal participants, who believe long term, a seigniorage protocol cannot work.
History of Blum & BOMB Chain
In our never-ending journey to bring health to seigniorage protocols, we had tried many things in the past. We always figured, if we can bring in significant inflows of blue chip crypto, we can generate a good yield for those investors, and bring health to our ecosystem. This was the reason for the creation of the “BOMB App”. BOMB App was a simple DeFi wallet + staking service, with BOMB Chain powering it.
The unique advantage of BOMB App staking was the fact that we had BOMB Chain as the backend. Everything is 100% transparent on the blockchain, which we felt was a strong selling point with all the recent centralized crypto exchanges/business collapses.
BOMB Chain was supposed to be a DeFi hub. It would also be the backend of BOMB App, but largely, it was intended to be home to a wealth of DeFi protocols.
What Went Wrong
Let’s start with BOMB Chain. This has been an idea since the early days of OG BOMB. Was super excited to work with ANKR on it, but that excitement soon faded when I realized they gave us a blockchain that could not support “tracing” RPC calls. Without getting into too much detail here, many DeFi apps get their data from subgraphs, which tracks things like reward pools, liquidity, and more (depending on the dapp). Many subgraphs require tracing support on the node they are connected to for all features to work.
ANKR, knowing we are creating BOMB Chain as a DeFi chain, had never advised us of any potential issues. The nodes capable of running BOMB Chain, do not, and will never, support tracing. Other blockchains have numerous “software node” options, so if one does not support tracing, another can be used that does. ANKR has given us 0 paths to a solution on this.
This is the reason why BOHM Money never got support for Bonding BOHM. The backend required subgraphs, which required tracing nodes. This was impossible to work around.
Several other BOMB Chain projects, or enhancements to other projects, were not pursued due to lack of support for tracing. BOMB Chain would look very different today if we had a blockchain that supported our vision.
Let’s Talk Blum and Evolution from BOMB App
What was BOMB Apps strong point, in having a blockchain as its backend, had its own challenges. Development was more difficult than if we had been a centralized solution, and the user experience had some less-than-ideal aspects, due to blockchain constraints. We were willing to deal with the additional challenges and I think we put together a good product.
In hindsight, even at the stage of BOMB App still being BOMB App, there were too many moving parts, it was too complex of a system — for the purpose of making a seigniorage protocol healthy. We had a blockchain, our own bridges, had to develop smart contracts for staking, a front-end for the app, reporting and security dashboards, and much more. It was crazy to think to do all of this as a small team, but it seems we were willing to do just about anything to attempt to get seigniorage protocol health back up.
The decision to rebrand to Blum is not one that I was personally crazy about. Research that was done, and feedback from the community showed that Blum would make for a better name than BOMB for this service, so we went with it.
What was the “strong point” of BOMB App, with BOMB Chain as the backend, did not make sense for Blum. A new Blum user having to connect to BOMB Chain would not make sense to them, and was an extra thing we would need to explain.
It is much easier to create a solution for a new crypto user which is centralized, as the entire user journey can be 100% controlled, instead of having to deal with constraints of the blockchain and processing transactions. Having BOMB Chain power Blum was a negative for the user, and a negative for us building and supporting it.
Main Reasons for Discontinuing Blum & BOMB Chain
While I do feel it would have been possible to generate inflows through Blum, the project had evolved into something I no longer liked. I loved running a crypto protocol — OG BOMB was some of the most fun I’ve had in my life. To operate all the required components of Blum, my job was no longer something I enjoyed.
As I mentioned previously, BOMB App itself was a flawed idea due to the complexity. The evolution to Blum compounded the issues, and now we had all this complexity, to offer a solution that did not make sense. Blum as a centralized solution would have been more effective, but still not a project I would have been passionate about.
With BOMB Chain not being able to be the DeFi chain we originally intended; its only purpose now was to be the backend of Blum. And once again, this combination did not make sense.
I really wish that I would have come to this conclusion sooner. Not wanting to disappoint anyone, and striving for protocol health at any cost were contributing factors. Ultimately, dragging this on for so long is on me, and I am deeply sorry.
I hope to see everyone on our Twitter Space tomorrow, where I will address any outstanding questions and concerns.