Aptos Mainnet Launch Draws Criticism

Aptos, a blockchain startup founded by ex-Meta employees, launched its mainnet yesterday, but it has been falling short of expectations, according to some prominent crypto traders.

Before its launch, Aptos was dubbed a potential “Solana killer” and made promises to make transactions faster and cheaper on a blockchain that supports NFTs, DAOs and DeFi activity. 

The layer-1 proof-of-stake blockchain is the brainchild of Mo Shaikh and Avery Chin, who had previously worked on Facebook’s abandoned cryptocurrency project Diem.

Their Palo Alto-based company raised over $150 million dollars in a Series A funding round in July led by FTX Ventures with participation from prominent venture capital firms such as Jump Crypto and a16z. The company previously raised a $200 million strategic round in March. 

After its summer fundraise, Aptos was valued at over $1 billion dollars, giving it unicorn status. But despite 4 years of work and the team’s vaunted treasury, the rollout has been rocky.

Aptos claimed that its network could handle up to 130,000 transactions per second (TPS) during its tests, more than existing layer-1s such as Ethereum and Solana.

In a Twitter thread, pseudonymous developer ParadigmEngineer420 said he observed activity amounting to just 4 TPS, and that a “majority of these transactions are not actual transactions, they are merely validators communicating and setting block checkpoints and writing metadata to the blockchain.”

However, Blockworks Research Analyst Dan Smith was unfazed that there are not yet multitudes executing transactions on the first day of the blockchain’s launch. 

“Launching an layer-1 is a multi-year undertaking,” Smith said. “We need to remember how fresh this technology is and understand that there will be bumps in the road. If you bridge to a new chain, you are trailblazing and undertaking the maximum amount of risk possible; expect chaos.”

Aptos tokenomics unclear

Throughput claims aside, Smith does, however, raise concerns about Aptos’ tokenomics, noting that both unlocked and locked tokens can be staked.

That means “investors and core team members can use their locked allocations to earn staking rewards that are eligible to be sold at will,” Smith said.

Of the total supply of about 1 billion Aptos (APT), around 820 million are currently staked, ParadigmEng420 tweeted.

“This means that a bit over 80% of the token supply is controlled by the team and investors, as there was no airdrop nor other method as to earn mainnet Aptos tokens,” they said. “There was never a public sale or another method where users could have earned tokens,” he said.

That estimate is contradicted by the tokenomics documentation provided by the Aptos Foundation, which puts the “Core Contributors” and “Investors” allocation at around 32.5%, which a majority of tokens earmarked for the “Community.”

Aptos did not immediately respond to Blockworks request for comment.

Paul Fidika, a Solana developer who worked on the development of Aptos staking, also tweeted that Aptos tokens which will be going on sale tomorrow on FTX, Coinbase and Binance, are not going to come from public supply of the token, but rather from insiders. He suggested his personal involvement experience as a developer led him to become disillusioned with the project.

In a separate review of the project, tech investing veteran Anders “CTO” Larsson, said he repeatedly inquired with project representatives via Discord as to the initial circulating supply, but was stonewalled.

Loading Tweet..

Smith sees parallels to applications built on Solana.

“Many Solana DeFi projects were launched this way and have suffered a down-only fate,” Smith said. “I am wary about Aptos, but in the end state of crypto, I believe there is room for a blockchain that optimizes for throughput. Will it be Solana, Aptos, or the yet-to-launch Sui? I will be watching.”

Macauley Peterson contributed reporting.

---

Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.