NFT marketplace Blur has overtaken industry giant OpenSea in trading volume following its BLUR token airdop. While Blur’s growth has been impressive, it’s built on unsustainable promotions.
According to DappRadar, Blur handled $613M in NFT transactions over the last seven days compared to OpenSea's $108M. The rivalry between the two platforms reportedly led to a price war as OpenSea waived its transaction fees to compete with Blur, which is currently not charging fees.
Blur's trading volume boom followed the launch of its governance token, BLUR, in addition to a temporary promotion which rewards active participants with BLUR tokens. More than 94% of eligible users have claimed their BLUR tokens, according to a Dune Analytics dashboard. So BLUR has insanely high engagement among people who like free stuff, but we're still waiting to see if the marketplace can outperform OpenSea without paying for the volume.
As it became clear that Blur was going to pass it, OpenSea dropped its cross-listing policy that was essentially forcing people to choose if they wanted to list on Blur or OpenSea. The platform also said it will not block any marketplace with the same policies, so Blur will no longer be blacklisted.
OpenSea tried to starve out Blur's liquidity by forcing people to choose either Blur or OpenSea when listing their NFTs, but that didn't work so now they're playing nice.
Since its launch last week, the BLUR token has outperformed the broader market, gaining nearly 67.3% while ETH was up almost 11.3% during the same period.