Ethereum Layer-2 Blast to Shut Down as Assets Fall 98% From Peak
Blast, an Ethereum layer-2 network, is shutting down roughly two years after launch because it can no longer cover operating costs. Total value locked has dropped from a peak above $2 billion to about $32 million, and its BLAST token is down roughly 98% from launch. Users have until Oct. 26 to withdraw assets through Blast's interface.
Blast, the Ethereum layer-2 network that once held more than $2 billion in deposits, is shutting down. The project announced the closure in a Friday post, saying the chain's running costs have outgrown the revenue it generates. "Unfortunately, the economics of operating the chain no longer make sense," the team wrote, adding that it sees no credible route to making Blast economically sustainable.
The decision lands just over two years after Blast's 2024 launch, when demand was intense. Before the network even went live, users had deposited more than $1.1 billion, drawn in part by anticipation of a token airdrop, CoinDesk reported at the time. Total value locked peaked above $2 billion in June 2024 and has since collapsed to roughly $32 million, according to DeFiLlama.
The revenue picture is similarly stark. Blast brought in just $1,793 from network usage last month, compared with a peak of about $3.5 million in June 2024, DeFiLlama data shows. Its native token, BLAST, dropped 19% following the shutdown announcement and now trades about 98% below its launch level.
Users were given a deadline to move funds. Blast said assets can be withdrawn to Ethereum through its interface until Oct. 26; after that date, withdrawals require interacting directly with bridge contracts. The team's announcement came in a post on X.
Blast's closure reflects a wider shakeout among blockchain networks, where development, infrastructure and security bills keep coming even after activity fades. A recent run of crypto exploits has sharpened attention on security spending, and AI tools may make it easier for attackers to probe code for weaknesses, according to CoinDesk.
Competition has also intensified. Coinbase rolled out Base and channels its exchange users and developer ecosystem into the network, while Robinhood launched its own Ethereum layer-2 earlier this year and saw heavy early onchain activity. Smaller chains are left competing for a shrinking pool of developers, users and transaction fees — a dynamic Blast's shutdown illustrates when the numbers stop adding up.
TopicsBlast · BLAST · Ethereum · CoinDesk · DeFiLlama · Coinbase · Base · Robinhood
Written by Paparazzi with AI. Not financial advice.