OpenSea faces rough waters as Blur storm shows no signs of abating

• OpenSea’s trading volume market share plunged from 44% to a little over 14% in 10 days.
• Blur edged out OpenSea in terms of the total number of trades as well, capturing 56% of the market share.

OpenSea had been hit hard because of the Blur [BLUR] storm that swept the NFT marketplace ecosystem. According to a tweet, more than 13k addresses canceled all their orders on OpenSea in the past week.

A total of 13.6k wallet addresses canceled their OpenSea orders in the past week due to Blur’s loyalty program, which is almost 5-6 times the historical average. According to @andrewhong5297 Dune. https://t.co/DWP0jFZ7TD pic.twitter.com/mSZJcfcfrL

— Wu Blockchain (@WuBlockchain) February 26, 2023

A Dune Analytics researcher opined that this could be due to Blur’s loyalty program announced the last week, wherein more than 300 million tokens would be distributed to community members who will prefer Blur over other marketplaces.

Even after making major changes in its marketplace policy such as scrapping service fees, OpenSea was not able to gain the confidence of users back.

OpenSea faces rough waters!

At the time of writing, OpenSea’s share in the total trading volume across marketplaces plunged from 44% before the launch of the BLUR token to a little over 14% as of 24 February, data from Dune Analytics revealed.

As indicated in the graph below, Blur’s volume exploded since the launch of its token, increasing by more than seven times.

Source: Dune Analytics

Well, interestingly, OpenSea was hit hard but it started to show signs of recovery in its daily active users and revenue from 19 February. However, Blur’s loyalty program announcement on 22 February halted its ascent again, data from Token Terminal showed.

With OpenSea effectively cutting off its primary source of revenue by dropping fees, it remains to be seen which other avenues would be explored to increase the income.

Source: Token Terminal

OpenSea loses on the sales front as well

Surprisingly, Blur edged out OpenSea in terms of the total number of trades as well, capturing 56% of the market share and pushing OpenSea lower to 35%.

This was concerning as OpenSea enjoyed considerable dominance on this front for a longer period of time by virtue of it being popular among individual investors rather than professional traders which Blur focused on.

Source: Dune Analytics

How much are 1,10,100 BLURs worth today?

Despite the buzz surrounding Blur’s exponential growth, experts raised concerns over wash trading. According to a tweet by an analyst from Nansen, only 20% of the Blur’s trading volume was organic, which was a worrying sign for the long term.