Blast Shuts Down as Costs Outpace Revenue and TVL Drops Sharply

Ethereum layer-2 network Blast has announced it will shut down due to unsustainable operational costs. The network stated that maintaining the chain has become more expensive than the revenue it generates, and no viable path to economic viability was found. This decision comes as Blast's total value locked (TVL) has plummeted to approximately $32 million, a dramatic decline from its peak of over $2 billion following its mainnet launch in February 2024.

The shutdown process will begin with users withdrawing their assets to the Ethereum mainnet. Blast first plans to retrieve assets deposited with Lido, a process expected to take about a week. Afterward, users can withdraw their assets through the Blast interface until October 26. Beyond that date, withdrawals will require using the Blast bridge contract on Ethereum directly.

Blast launched in November 2023 after securing $20 million in funding, led by Paradigm and Standard Crypto. The network's native token, Blast, saw a 17% drop in value following the shutdown announcement, reducing its market capitalization to around $23 million.