Blur to Shut Down Website as NFT Traders Revisit Creator Royalty Controversy
Blur, once the leading NFT marketplace by trading volume, plans to shut down its website next month, drawing mixed reactions from the NFT community and renewed criticism of the business model that helped it rise to prominence.
The platform announced on X on Monday that its website frontend will close on Nov. 12. However, its onchain marketplace will remain operational, allowing users to continue interacting with the protocol through other interfaces.
Blur is also winding down new loan matching on Blend, its peer-to-peer NFT lending protocol. Borrowers must repay outstanding loans by Nov. 12 or face default. The company said it would provide a withdrawal interface after the website closes.
The announcement, which marked Blur's first post on X in more than a year, prompted several NFT collectors to criticize the platform's legacy.
“Good riddance. You destroyed NFTs. Please shut down and never come back,” NFT collector Cryptobscure wrote in a reply to the announcement.
Another collector, starfruit, accused the platform of making persistent efforts to damage the NFT sector, adding that the community had survived despite its actions.
Blur's rise put pressure on NFT royalties
Launched on Oct. 19, 2022, Blur quickly gained market share by appealing to active NFT traders. Its approach combined customizable creator royalties with prospective token rewards designed to encourage trading activity.
Sellers could adjust royalty payments, while traders could qualify for larger potential token rewards by paying higher creator royalties. The strategy helped Blur attract liquidity and trading volume, eventually allowing it to overtake OpenSea during 2023.
However, the platform's growth intensified an industry-wide shift away from mandatory creator royalties. As marketplaces competed for traders, lower fees became a way to attract users, putting pressure on the income NFT creators received from secondary sales.
The shift had already begun before Blur launched. Rival marketplace Magic Eden had moved to optional royalties the previous week, highlighting the growing competition over marketplace fees.
By July 2023, effective creator royalty fees had fallen to 0.6%, down from an average of 2.5% in 2022, according to blockchain analytics data from Nansen at the time. The decline was linked in part to Blur's growth, its minimum royalty policy and OpenSea's decision to reduce its own royalty requirements in response to competition.
The resulting debate centered on whether marketplaces should prioritize trading activity and lower costs for buyers or protect creators' ability to earn from the continued resale of their work.
NFT market contraction adds to industry pressure
Blur has not explained why it is closing its website or ending new loan matching on Blend. The decision comes as NFT trading remains well below the levels recorded during the sector's peak.
CryptoSlam data shows NFT sales totaled $167 million across approximately 2.9 million transactions in September. By comparison, January 2022 saw around $6 billion in sales across 13.7 million transactions, illustrating the scale of the market's decline.
Blur's planned shutdown also follows a series of exits and changes across the NFT industry. Gemini-owned Nifty Gateway and social collecting platform Rodeo announced plans to wind down in January. Foundation announced its closure in April after a proposed sale that could have kept the platform running fell through.
Binance has also discontinued NFT support on its exchange, directing users to manage their assets through Binance Wallet.
Although Blur's onchain marketplace will remain available, the closure of its main website marks another change for an NFT sector still struggling to recover its former trading volumes. Its departure from the frontend market also brings renewed attention to the trade-off between competitive marketplace fees and sustainable earnings for digital artists.