OpenSea Claws Back Market-Share from Blur

OpenSea has reclaimed some of its market share from Blur, flipping Blur in 24-hour volume and total sales following the recent decline in incentives on Blur. On June 26, OpenSea recorded 2,184 sales, narrowly surpassing Blur’s 2,138, marking the third such instance in the past 90 days. Over the last 120 days, OpenSea holds a 39% user-share with 177,565 unique buyers, compared to Blur's 154,040.

The shift comes after Blur launched the Blast token, leading to a reduction in user rewards, which had previously driven significant activity on the platform. This reduction prompted some major market makers on Blur to withdraw from the protocol. Despite OpenSea’s recent gains, Blur still commands 62% of the total volume over the past 90 days.

Market participants have mixed opinions on the long-term impact of Blur’s decreased incentives. Some, like Blur farmer Cbb0fe, express skepticism, suggesting that recent activity has merely served as exit liquidity for more savvy holders. Conversely, NFT investor OGDFarmer views the fluctuations as part of a natural boom-and-bust cycle common to emerging asset classes.

OpenSea, founded in 2017, was the leading NFT marketplace during the 2021 bull run, handling over $100 million in daily sales at its peak. In January 2022, it raised $300 million at a $13.3 billion valuation. However, Blur's launch in 2022, with its trader-focused incentives and reduced creator royalties, quickly eroded OpenSea's market share.

Blur’s aggressive strategy included penalizing users for engaging with competing platforms like OpenSea, which contributed to its rapid dominance. Following a successful airdrop, many participants shifted to Blur to farm its token distribution, leading to a significant decline in OpenSea's market share. By November 2023, OpenSea had laid off more than 50% of its staff, and its lead investor, Coatue Management, reduced its valuation by 90%, estimating the company’s worth at below $2 billion.

The broader NFT market has been recovering since the largest market maker on Blur, Cbb0fe, withdrew liquidity on June 17, causing an initial selloff. Floor prices for major collections like Pudgy Penguins, Bored Ape Yacht Club, and Milady have rebounded by over 5%, with CryptoPunks recovering to 27 ETH after dipping to 22 ETH.

Despite a bleak market in 2024, with top collections down over 50% from their yearly highs and significantly lower volumes, this week’s developments might signal a potential comeback for OpenSea as it continues to claw back market share from Blur.

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