Uncovering the Controversies of Aptos

Aptos, the highly anticipated Layer 1 blockchain using Move language announced its mainnet launch in the early morning of October 18, 2022 (GMT+8). Following shortly, major exchanges in the market issued announcements to open withdrawal and trading on the 19th, including Binance, FTX, Coinbase, Huobi, Okex, and others.

Aptos's aim is to build a scalable, safe, trustworthy, and upgradeable smart contract platform that can meet the needs of billions of users in the future.

Strong support from huge venture capitals and exchanges sparked the interest of users in Aptos, despite the bear market. This also meant Aptos faced heavy public scrutiny, including some uncertainty and doubts before the mainnet launch as well as skepticism towards its heavy price fluctuations after launch.

In response to these controversies, Coinlive has comprehensively compiled interviews of relevant guests from Ouyi and Moledao on these issues.

Specifically, a deeper dive was done into various aspects of Aptos (even some that are not disclosed by their official team), through interviews with Hailey, a researcher from Ouyi and ZF, Tech Lead for Moledao.

What is Aptos?

In response to this, ZF said that Aptos is a L1 public chain that relies on the proof-of-stake DiemBFT consensus and adopts the Move programming language. It was initiated by the core personnel of the original Meta Libra (later renamed Diem).

According to the data, Aptos was co-founded by former employees from Meta, Mo Shaikh (CEO), and Avery Ching (CTO), of which both have many years of senior development and engineer experience in the blockchain industry.

1. How about the technological and ecological aspects of Aptos?

In terms of technology, Hailey believes that Aptos allows for the direct integration of programs and digital assets. The Move language Aptos adopts also makes up for security vulnerabilities in Solidity language. Hence Move could be the next Solidity “killer”.

However, as to whether Aptos has more advantages over other L1 blockchains, Hailey is not very confident. Having an edge due to their unique programming language is not enough to form a competitive barrier. Also, although Solidity is fundamentally less secure compared to Move, it still has a first-mover advantage and developers are hesitant to leave due to inertia.

In terms of ecosystem, Aptos has the fastest developmental progression. The core team is well connected with the developers and teams of many native dApps building on it. This has also led to many considering Aptos as the next Solana. In addition to native projects, other projects on different chains have been slowly migrating or deploying onto Aptos to seize early dividends and acquire userbase in the ecosystem.

2. Why is Aptos so hyped?

Hailey believes the main reason for the increased public attention towards Aptos is due to the oversaturation of current Layer 1s in the market. People are eager to seek new differentiating public chains that have the potential to overtake Ethereum and other major chains.

Hailey elaborates that since Aptos is favored by top venture capitalists and has core team members from Meta (former Facebook), it immediately stands out as a potential competitor to the top chains.

3. Investment support
In addition, Haily states that their staggering valuation and funds raised have also put Aptos in the eyes of the public. Aptos has received funding from top capitals such as a16z and Multicoin with a total raised amount of more than 350 million US dollars, with an initial valuation as high as 2 billion US dollars. Shocking and unbelievable, in this bear market.

4. Can Aptos overtake the current layer ones and public chain competitors?

Hailey believes that Aptos still has a long way to go. On one hand, the veteran L1 blockchains such as Near, Solana, Avalanche, and BSC have first-mover advantage and are observing and adapting to Aptos; on the other hand, Sui, another upcoming Layer 1 that also adopts the same Move language, will also launch, and directly compete with Aptos; finally, there is the unshaken overlord Ethereum. Hence, Aptos performance remains to be tested by the market.

Controversies plaguing Aptos

1. Alarmingly low TPS (Transactions Per Second)

According to Aptos Explorer, on October 18, Aptos TPS was 4. On the 19th, it was 24 TPS. Both were very different from their promised 100k TPS. Aptos made an official response later, saying: "At present, users cannot participate in the ecosystem as not many protocols are deployed yet, and their respective tokens are not generated and tradeable, which is the reason for the low real-time TPS.

2. Shady tokenomics of Aptos

After Aptos announced its launch, the total supply of Aptos is over 1 billion but more than 800 million have been staked. This means that over 80% of the token supply is controlled by the team and investors. Furthermore, after subtracting the staked tokens from the total supply, where are the remaining 200 million liquid Aptos (APT) tokens?

3. Is Aptos Centralized?

Since 51.02% of the community's tokens are in the hands of Aptos Foundation and Aptos Labs, and 16.5% are owned by Aptos Foundation themselves, a simple calculation would show that the Aptos team controls at least 67.52% (51.02% of the community + 16.5% of the foundation) of the supply.

Before trading for Aptos $APT started, Aptos urgently released airdrop information and dispersed a total of 20 million APTs to early participants and supporters.

This also led to an initial circulation of 130 million (110+20) APTs. Since APT for investors and core contributors were completely vested and locked in the first year, 110 million were originally circulated by the Aptos team, and 20 million coins come from airdropped users.

4. Fresh Controversy

In addition to the above controversies, on October 19, some developers raised new questions about Aptos:

i. Aptos uses a fake proof-of-stake consensus mechanism and the mechanism is only used for economics rather than security. This is to appeal to investors as more prefer PoS over PoW. PoS allows for the locking of most of the circulating supply, hence it is easier to maintain a higher token price.

However, by having access to dozens of private keys (or less), one can stop the network (owning 1/3 stake) or take over the entire network (owning 2/3 stake) with a few transactions.

ii. The rights and interests cannot be shared across mining pools as they do not benefit from a PoS consensus.

iii. AptosBFTv4 consensus adopted by Aptos is just a rename of DiemBFTv4 and uses the HotStuff algorithm. This means that if there are slow validators, the network performance will drop rapidly, which is another reason why Aptos must closely monitor its validators.

At present, there is no official response to the above concerns.

Why are there heavy fluctuations in the price of Aptos?

1. Why does the price of APT fluctuate?

According to exchanges and price oracles, the highest price recorded was $100 shortly after APT was opened for trading, with the lowest price observed below $7. As of press time, the APT price was $7.7.

Some users have questioned whether APT went below the listing price, which was not the case as the initial price was observed to be 1 USD. The main reason for the fluctuations was the initial volatility observed at nearly every new and hyped listing on exchanges.

2. Airdrop claim details for Aptos

As announced by Aptos Foundation, a total of 20,076,150 APT tokens will be airdropped to 110,235 testnet participants through [email protected]. The very first airdrop by Aptos is based on existing community data.

It is reported that users who have completed the APTOS incentive testnet or originally minted "APTOS: ZERO testnet NFT" are eligible to claim APT Token.

Users who have successfully completed APTOS testnet incentive can claim 300 APTs, while users who minted "APTOS: ZERO testnet NFT" can claim 150 APTs for the airdrop. In addition, the Aptos Foundation provides community members with a one-time APT faucet to help users claim these airdrops.