NEW DELHI (CoinChapter.com) — NFT marketplace Blur.io launched the second season of the airdrop of its governance token BLUR on Feb 21. Unfortunately, despite the seemingly bullish cue, BLUR’s price action repeated its reaction to the previous airdrop, dropping more than 26% to reach a low of $0.96.
In its announcement, the Blur team highlighted that the platform processed $225 million in trading volume since launch. In comparison, NFT marketplace OpenSea processed $357 million in the same time frame. As a result, blur plans to place itself as the main competitor to OpenSea.
The airdrop announcement also highlighted some changes in the airdrop eligibility criteria. Participation in the Blur token airdrop season 2 requires users to have ‘Listing Points‘ and ‘Bid Points.’
Listings got a score based on how likely they were to sell and on their collection’s activity.
Additionally, the Blur team would award traders a bonus for “sweeping,” referring to a user buying the cheapest NFTs in a collection. Sweeping helps increase the floor price of a collection.
Furthermore, Blur launched a bidding system on its platform. Users would have to bid in ETH. Moreover, the service would include Stolen NFT Protection, allowing users to place or cancel bids without paying for gas.
BLUR Token Price Drops As Airdrop Launches
Meanwhile, BLUR, the NFT marketplace’s governance token, dropped its prices despite the airdrop announcement. BLUR price’s rapid descent suggests traders might not have a positive outlook for the token’s long-term prospects.
Earlier, the lack of clarity regarding BLUR tokenomics fueled suspicion amongst market participants. As a result, airdrop recipients quickly offloaded their token holdings. The sell-off forced the BLUR token price down by over 90% from its Feb 14 launch price of $5 within a couple of hours.
The team behind blur released BLUR tokenomics, revealing that BLUR has a total supply of 3 billion tokens. With a capped supply, the BLUR token would slowly become deflationary, which might help attract buyers.
The Blur Foundation, which manages the platform’s DAO, has allocated 51% of the total supply (1,530,000,000 BLUR) for the community members. Additionally, the team reserved 29% for “past and present contributors” with a four-year lock-in period.
Blur investors have a share of nearly 19% of the total token supply. In addition, the Blur Foundation has reserved about 1% of the 3 billion BLUR tokens for advisors of the project. Both investors’ and advisors’ shares have a minimum four-year lock-in period.
The DAO would gradually release the tokens over the next four years in a gradually diminishing manner. For example, blur would unlock 40% of the supply in the first year.
Blur Overtakes OpenSea In Daily Volumes… Or Does It?
Per data from Dune Analytics, Blur has been outshining OpenSea over the past few days. The upcoming NFT marketplace has attracted users through features like zero trading fees and artist royalties.
While Blur lags OpenSea in terms of daily users, the platform enjoyed a steady increase in user numbers over the past 30 days. Moreover, the daily trade count on Blur has been higher than OpenSea since Feb 16.
Additionally, Blur left OpenSea miles behind it regarding daily trading volume for the sixth consecutive day on Feb 21. However, the trading volume might have been a result of wash trading.
In detail, wash trading is a market manipulation technique in which investors simultaneously buy and sell the same financial instruments. The action creates artificial activity in the marketplace, driving speculation and spiking volumes.
For example, the largest airdrop recipient address (0xd5ee00b7babd9374d32159cd7cd82bb99ef831fd) might have been involved in wash trading. The address has traded the same NFTs multiple times to game the Blur trading model.
Furthermore, the second and third-highest airdrop recipients have had several interactions with the wallet mentioned above. The pattern suggests that either an individual or a group of individuals are coordinating to manipulate the Blur airdrop model.
Meanwhile, the Blur airdrop also helped Blur record increased trading volume. Blur token airdrops use a points system that rewards users for the liquidity pools.
OpenSea Responds To Blur Threat
Interestingly, with Blur breathing down its neck, OpenSea recently incorporated several changes to its marketplace, including zero market fees “for a limited time” and “optional creator earnings” for all its collections.
OpenSea criticized the shift towards platforms that do not “fully enforce” creator earnings or royalties. However, the NFT marketplace stated that it chose on-chain enforcement for creator earning, believing it to be the best way to secure the creators’ revenue streams.
We thought we could catalyze widespread enforcement of creator earnings, and we hoped others might come up with more resilient solutions – this hasn’t happened.
However, with Blur choosing to roll back creator earnings for its collections, OpenSea was forced to respond in kind to remain relevant in the NFT sector. In addition, OpenSea developers have the platform’s operator filter to “allow sales using NFT marketplaces with the same policies.”
A Delhi-based Markets writer, I did my bachelor's in engineering with major in electronics and communications. I first heard of bitcoin while writing an article about blockchain technology a few years back, and have been following it ever since. Bitcoin may well be current big thing happening in the finance industry, and it feels like the right time to join the crypto bandwagon.