Blur is shutting down its website, so why are NFT collectors cheering?

The marketplace made the announcement on X on Monday, marking its first post on the social media platform in more than a year. According to the company’s official statement, the frontend interface of the website will officially shut down on November 12. However, the underlying onchain marketplace infrastructure will remain operational, allowing users to continue interacting with smart contracts directly.

Alongside the website shutdown, Blend, the peer-to-peer perpetual NFT lending protocol developed by Blur, will also cease matching new loans. Blur stated that active borrowers have until the November 12 deadline to fully repay their outstanding loans or risk allowing them to default. To mitigate panic regarding trapped capital, the platform has promised to provide a dedicated withdrawal interface even after the primary website frontend goes offline, ensuring users can retrieve their assets.

The reaction from the broader digital art and collectibles community was swift and severe. Rather than expressing dismay over the loss of a major market infrastructure player, many prominent collectors took to social media to voice long-held grievances against the platform’s historical business model.

"Good riddance. You destroyed NFTs. Please shut down and never come back," wrote NFT collector Cryptobscure in a pointed reply to Blur’s announcement on X.

Another prominent collector, known as starfruit, echoed the sentiment in a subsequent post, writing, "You may not have been able to complete your mission to destroy NFTs. But you acted with extreme determination and tried everything. Congratulations to us for surviving you."

These biting remarks brought renewed attention and criticism to the aggressive market strategies that originally propelled Blur to the pinnacle of the NFT trading charts back in 2023. The platform’s meteoric rise was fueled by a combination of optional creator royalties and lucrative token reward incentives that heavily encouraged high-frequency traders to bid on, flip, and churn digital assets at unprecedented speeds.

Blur’s disruptive market entry significantly accelerated an ongoing industry-wide shift away from mandatory creator royalties. When Blur officially launched on October 19, 2022, it introduced a mechanism that allowed sellers to customize their royalty payments while offering larger prospective platform token rewards to traders who opted to pay higher creator royalties.

Although Blur entered a market where creator royalty protections were already beginning to erode—competing marketplace Magic Eden had transitioned to optional royalties just the previous week—Blur’s aggressive fee structure fundamentally transformed the economic landscape of digital art. By July of the following year, blockchain analytics platform Nansen reported that effective creator royalty fees had plummeted to an average of just 0.6% in July 2023, down sharply from an average of 2.5% in 2022. Nansen and other industry observers attributed a significant portion of this dramatic decline to Blur’s explosive growth, its minimum royalty policy, and the subsequent defensive maneuvers by rival platforms like OpenSea, which lowered its own royalty requirements to remain competitive.

NFT sales slump from boom-era highs

While Blur’s announcement sent ripples through the digital asset community, the marketplace did not disclose the specific strategic reasons behind its decision to shutter its frontend website interface and wind down new lending activity on the Blend protocol.

The closure comes at a time when the broader NFT trading sector continues to languish far below the historic peaks witnessed during the market boom era. Comprehensive data from market tracker CryptoSlam highlights the stark contraction of the industry, revealing that total NFT sales for the month of September hovered at $167 million generated across approximately 2.9 million total transactions. In contrast, the market experienced its historic zenith in January 2022, when monthly sales volume reached an astronomical $6 billion across 13.7 million transactions.

This prolonged market downturn has taken a heavy toll on specialized infrastructure providers across the ecosystem. Blur is far from the only high-profile platform to retrench or close its doors amid the shifting economic climate. Gemini-owned Nifty Gateway and social collecting platform Rodeo both announced plans to wind down their operations in January, while Foundation announced its permanent closure in April after a planned acquisition intended to keep the platform operating ultimately fell through. Meanwhile, major centralized cryptocurrency exchanges have also stepped back from the sector, with Binance officially ending NFT support on its primary exchange and shifting asset management tools to Binance Wallet.

As the industry processes the impending closure of one of its most influential and controversial market makers, Cointelegraph reached out to Blur founder Tieshun “Pacman” Roquerre for additional comment on the platform’s future trajectory.