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

Nonfungible token marketplace Blur, which once overtook OpenSea as the largest NFT marketplace by trading volume, says it is shutting down its website next month — and some NFT collectors couldn’t be happier.

Blur made the announcement on X on Monday, its first post on the platform in more than a year. It said the frontend will shut down on Nov. 12, while its onchain marketplace will remain operational.

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

“Good riddance. You destroyed NFTs. Please shut down and never come back,” said NFT collector Cryptobscure in a reply to the post on X.

“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,” NFT collector starfruit said in another post.

The post renewed criticism of the strategy that helped Blur reach the top of the NFT charts in 2023: optional creator royalties and token rewards that encouraged traders to bid and flip NFTs. Its rise accelerated a shift toward lower creator royalties, with rival OpenSea later moving to optional creator fees for new collections.

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

But it entered a market where royalty protections were already weakening: competing marketplace Magic Eden had moved to optional royalties the previous week.

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

NFT sales slump from boom-era highs

Blur didn’t disclose why it made the decision to shutter its frontend and wind down new lending activity on Blend.

Related: Magic Eden scare puts 3,832 NFTs in whitehat protective custody

However, the decision comes as NFT trading remains far below its boom-era levels. Data from CryptoSlam shows total NFT sales in September were $167 million over 2.9 million total transactions. The peak was in January 2022, when there was $6 billion in sales over 13.7 million transactions.

Gemini-owned Nifty Gateway and social collecting platform Rodeo announced plans to wind down in January, while Foundation announced its closure in April after a sale intended to keep it operating fell through. Binance also ended NFT support on its exchange, shifting asset management to Binance Wallet.