Blur's token was already soaring, and then rival marketplace OpenSea announced it was laying off half of its staff.
The token's price had already increased to $0.27 from $0.15 over a period of about three weeks, a gain of 80%, but after OpenSea announced on Friday it had let go of half of its staff, it shot up another 33%, according to The Block data.The fact that Blur's token is rising in value amid its rival's struggles is indicative of how thoroughly the marketplace has decimated OpenSea after usurping it as the number one NFT trading portal by volume.
"It's very difficult for OpenSea to compete," said Kay, citing how dramatically Blur's business model undercut OpenSea when it introduced a "minimum 0.5% royalty fee, coupled with attractive airdrops and bidding incentives."In contrast, OpenSea's business model was predicated on charging both higher royalty and platform service fees.
"Blur is not a profitable business by fees," added Kay. "But they made up for it by releasing a token, since they have equity in the company through its initial allocation ... usually a certain percentage is kept for founders." While Blur has not stated what percentage of tokens its founders may have held onto, the company's token distribution specified 51% earmarked for community, 29% to past and future core contributors, 19% to investors and 1% to advisors.
On Friday, OpenSea said its move to drastically reduce headcount is part of a new strategy focused on "product upgrades to technology, reliability, speed, quality and experience." © 2023 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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