Blur Is Shutting Down Its Website, So Why Are NFT Collectors Cheering It On?

Blur's planned website shutdown has revived criticism of its royalty policies and symbolic rewards, which helped it overtake OpenSea during the NFT boom but harmed creators.

The planned shutdown of Blur's website has revived criticism of the royalty policies and token awards that helped it outpace OpenSea during the NFT boom, but hurt creators.

Immutable token marketplace Blur, which once surpassed OpenSea as the largest NFT marketplace by trading volume, says it's shutting down its website next month — and some NFT collectors couldn't be happier.

Blur announced the news on X on Monday, their first post on the platform in over a year. The company said the front end will shut down on Nov. 12, while its chain marketplace will remain operational.

Blend, a permanent peer-to-peer NFT lending protocol, will also stop matching new loans. Borrowers have until Nov. 12 to repay outstanding loans or allow them to default, Blur said. It also promised a withdrawal interface after shutdown.

NFT collector Cryptobscure responded to X's post: “Cheers.

"You may not have been able to complete your mission to destroy NFTs. But you acted with great determination and tried everything. We congratulate you on your survival," NFT collector Star Fruit said in another post.

This post brings new criticism to the strategy that helped Blur reach the top of the NFT chart in 2023: optional creator royalties and crypto rewards that encouraged traders to bid and return NFTs. Its increase accelerated the shift to lower producer royalties, and competitor OpenSea later moved to discretionary fees for new producers.

Blur launched on October 19, 2022, allowing sellers to customize royalty payments while offering potentially larger token rewards to those who paid higher creator royalties.

But it entered a market where royalty support was already weak: rival market Magic Eden had gone royalty-free the previous week.

By July of the following year, blockchain analytics platform Nansen reported that creators' effective royalty fees had fallen from an average of 2.5 percent in 2022 to 0.6 percent in July 2023, attributing much of the gap to Blur's growth, its minimum royalty policy, and OpenSea lowering its royalty requirements to compete.

Blur did not disclose why it decided to close its front-end and reduce new lending activity on Blend.

However, the decision comes as NFT trading remains well below its boom-time levels. CryptoSlam data shows that total NFT sales in September were $167 million from 2.9 million total transactions. The peak was in January 2022, when it had $6 billion in sales over 13.7 million transactions.

Gemini-owned Nifty Gateway and social crowdfunding platform Rodeo announced plans to wind down in January, while the foundation announced its closure in April after a sale to keep it afloat failed. Binance also ended NFT support on its exchange and moved asset management to Binance Wallet.

Cointelegraph reached out to Blur founder Tieshun "Pacman" Roquerre for comment.