Blast is preparing to shut down Layer 2 operations at Ethereum after costs exceeded revenues.

Blast is shutting down the Layer 2 network of Ethereum . Users are to withdraw by October 26th.

Blast, the second-tier network of Ethereum , announced its closure after operating costs exceeded revenues generated by the network, posting on X on Friday that it had not found a credible path to make the network economically sustainable and asking users to transfer assets from Blast back into the main Ethereum network.

The development team noted that the launch of Blast was aimed at creating a self-sustaining chain for users and developers, but the economics of network operations were no longer rational. This announcement made it necessary for asset holders to track withdrawal procedures during transitions.

The withdrawal phase and the deadline, October 26.

According to the announcement, Blast will reduce its sleep time by 24 hours but withdrawals will be temporarily shut down while Lido's asset-withdrawal network is in use. The process is expected to take about a week. Users still have until October 26th to withdraw through Blast's interface.

After that date, assets will still be accessible but withdrawals will no longer take place through the Blast screen. Users must transact directly on Blast's bridge contract at Ethereum .

The path from Blur to Blast.

Blast was founded by Tieshun acPacman Roquerre, the founder of Blur,NFT a marketplace that launched in October2022 and challenged OpenSea with a focus on amateur traders with token-like incentives by year's end.2023 Blur had its previously leading OpenSea -page trading volume and continued to expand segments at the beginning of the year,ETH partly driven by funding from token giveaways and rewards for traders.

Roquerre launched Blast in November2023 with in-game rewards for Ether (ETH) and stablecoins, as well as a scoring system tied to the expected distribution of tokens. Such strategies helped attract more than $5 million in deposits before the launch of Blast's main network in February.2024

DeFi and Blur followed suit

Blast's growth was unable to sustain itself amid the market downturn,2023 with total value locked inDeFi of Blast declining steadily from a peak estimated at2,200 million dollars in June,2024 and falling more than98% counted since then according to data from DefiLlama .

Blur faced a similar decline, with the total value of Blur once pegged above $200 million in early years,2024 but currently at around $27 million.

Added context from the beginning.

The thread also mentions stablecoins being able to leak out of banking systems and countries quickly, as well as the fierce debate between THORChain and NEAR which shows that optimism has limits.

Something to keep an eye on.

The Blast closure requires users to follow the announcement of Blast and study withdrawal procedures through a bridge contract before October 26, so if determined, users will still be able to access assets but must transact directly on Ethereum , which adds complexity for ordinary users.