Nfts
Ethereum NFT Craters as Blur Incentives Diminish
Major liquidity providers have withdrawn their offerings ahead of the Blast token launch next week.
The floor prices of major Ethereum-based NFT collections, Pudgy Penguins and Bored Ape Yacht Club (BAYC), were slashed by a quarter last week after major Blur farmers. unrolled their positions.
Other popular collections aren’t faring much better, with DeGods plummeting 32% and Azuki down 15%. Meanwhile, CryptoPunks are down 13% and trading at their lowest level since November 2023.
NFT marketplace Blur ran an airdrop farming campaign where users are rewarded with [REDACTED], powered by Blast. Traders speculate that this will take the form of the network’s upcoming token Blast Layer 2, which is scheduled to launch on June 26.
Blur users earn points by bidding on NFTs and providing lending liquidity through the Blend protocol. Blur’s incentive structure has been controversial as liquidity is often not indicative of true demand, making collectors reluctant to enter the market.
As of June 17, more than $16 million was withdrawn from the Blur bidding pool, representing a fifth of the liquidity available on the buy side, according to research by Dune. dashboard.
The majority of withdrawals can be attributed to CBB0FE, Blur’s top farmer who has accumulated over three million points.
“It’s been a wild ride and probably our toughest moments in crypto yet. It’s time for us to close this chapter,” they said. tweeted yesterday.
“CBB accounted for around 40% of the entire Blur market in recent weeks. NFT Markets See New Wave of Red as Farmers Withdraw Offerings and Loans,” note Stats, a widely followed NFT analyst.
This has been a painful bear market for NFT collectors. With few exceptions, most have seen their holdings fall 90% or more from their 2021-2022 peaks.