Once a $2 billion Ethereum layer-2, Blast is shutting down after assets plunge 98%
Reported by CoinDesk · AI-assisted summary by ChikoCorp AI News Desk
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Summary
Blast, an Ethereum layer-2 network, announced it will shut down after failing to maintain economic viability. Launched just over two years ago, Blast saw a sharp decline in network activity and assets, with total value locked falling 98% from $2.2 billion in June 2024 to $32 million. The project cited operating costs exceeding generated revenue as the primary reason for closure.
Why it matters
The shutdown highlights growing consolidation in the blockchain sector due to rising security and operational costs. The report notes increased competition from major platforms like Coinbase and Robinhood, which have launched their own Ethereum-based networks, making it more difficult for smaller chains like Blast to sustain users and transaction fees in a crowded market.
Key context
Blast attracted heavy early interest, with over $1.1 billion deposited before its 2024 launch, partly driven by token airdrop expectations. Its peak total value locked and revenue in June 2024 were $2.2 billion and around $3.5 million respectively, but both have since plummeted. The closure underscores challenges smaller blockchains face maintaining security and development costs amid a competitive landscape with increased attack risks and evolving technologies.
Key numbers and entities
Blast’s total value locked decreased from $2.2 billion in June 2024 to $32 million. Network revenue dropped from $3.5 million to $1,793 monthly. The BLAST token price fell about 98% since launch and dropped an additional 19% after the shutdown announcement. Competitors mentioned include Coinbase (ticker COIN) with Base and Robinhood (ticker HOOD), both launching their own Ethereum layer-2 networks.
What remains unclear
The source does not specify the detailed plans for Blast's shutting down process beyond the Oct. 26 deadline for users to withdraw assets through its interface. It also provides no further insights into any attempts Blast made to secure sustainability or potential future projects from the team.