NFT marketplace Blur overtakes OpenSea

But can the excitement last?

After raising $11 million in a seed round led by venture capital firm Paradigm, Blur launched its marketplace in October. Initially, it tried to attract customers by handing out “care packages” and promising loyal users future rewards in the form of its cryptocurrency, BLUR. Earlier this month, it kept its promise and distributed massive amounts of “airdrop” tokens in three waves to encourage members of its target market – professional traders – to switch from other marketplaces.

For Season 2, the company plans to give away another 300 million tokens and tease the idea of ​​”loyalty points” to encourage developers to list their NFTs exclusively on Blur for more rewards.

Over 300 million BLUR will be distributed to the community in Season 2.

What’s the secret to maximizing rewards? Loyalty.

Users with 100% loyalty have the highest chance of Mythic Care Packs, which are worth 100x Uncommon Care Packs.

Here are 3 ways to maximize your loyalty👇 pic.twitter.com/Cgiemrvpxh

— Blur (@blur_io) February 21, 2023

Thanks in part to its token airdrops, Blur has overtaken OpenSea as the most popular marketplace with a revenue volume of $1.04 billion over the past 30 days, compared to OpenSea’s $479 million, according to data from DappRadar.

But it’s yet to be determined if Blur’s feat can be sustained. Competition between marketplaces has intensified in recent months – Blur has gained its recent advantage from lower fees.

Blur has no trading fee and enforces a minimum license fee of 0.5%. Meanwhile, OpenSea has a 2.5% fee and royalty enforcement tool to ensure creators get the royalty they choose, and can block marketplaces with optional royalty payments.

OpenSea’s tool directly impacted Blur until it reportedly found a vulnerability late last month. Last week, Blur directly targeted the royalty enforcement tool — and OpenSea directly — by saying it would enforce full royalty payments for creators as long as creators block trading of their collections on OpenSea.

The NFT marketplace responded by lowering its trading fee to 0% “for a limited time,” moving to an optional royalty fee of at least 0.5%, and scrapping its royalty enforcement tool.

We’re making some big changes today:
1) OpenSea fee → 0% for a limited time
2) Switch to optional creator earnings (minimum 0.5%) for all collections without on-chain enforcement (old and new)
3) Marketplaces with the same policies will not be blocked by the operator filter

— OpenSea (@opensea) February 17, 2023

The changes were a bold decision by OpenSea, which committed to enforcing author licenses after flirting with the idea of ​​following several other marketplaces making them optional last November.

A spokesman said the company was playing the long game.

“As we explore a different fee structure for our core business that reflects the needs of today’s ecosystem,” the spokesperson said in an email. “Longer term, we are investing in growing the overall market and diversifying our business model – through foundational infrastructure, best-in-class Trust & Safety solutions, and tools for developers and partners to build their businesses.”

Despite Blur’s recent dominance, some have claimed that their tokenomics are not innovative and could be detrimental to the NFT ecosystem as a whole, as NFTs are more about profit than art.

1. I will be 100% real here. @blur_io is bad for NFTs and CryptoArt. There have been jokes about NFTs being just “shitcoins with pictures” and Blur essentially made them that by creating a GUI that doesn’t minimize the actual art for NFTs to anything. pic.twitter.com/7vAs7osOcM

— exlawyer.eth/tez (@exlawyernft) February 24, 2023

Pedro Herrera, head of research at DappRadar, said that while Blur has earmarked 51% of its token supply for its community, the allocations are skewed.

“Unfortunately, it is becoming increasingly clear that only Ethereum NFT whales will become the main beneficiaries,” Herrera said Wealth. “To give you some context, about 80% of Blur’s volume comes from about 500 wallets.”

A Blur spokesperson said via Twitter direct message that while it’s true that some “whales” received seven-figure airdrops, there were also smaller individuals who received tens or hundreds of thousands of dollars from the airdrop.

“If you browse Twitter, you can find many examples of people tweeting that their drop has allowed them to pay off student debt, loans, etc.,” the spokesman said.

The bold move to acquire OpenSea after years of dominance – and in a bear market – shows that a new competitive era could be dawning in the world of NFTs. And all that’s left is to see how OpenSea will continue to respond to the threat.

“Now the question is who is OpenSea token,” Herrera said.

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