Blast Shuts Down: $2B Ethereum Layer-2 Collapses After 98% Asset Plunge

Blast, an Ethereum layer-2 network that once held more than $2 billion in crypto assets, is shutting down, the project announced. The closure comes after assets on the platform plunged 98% from their peak, as activity faded and operational costs rose.

Launched with high expectations, Blast attracted billions in deposits by offering native yield for ETH and stablecoins. However, the network struggled to maintain momentum amid a crowded layer-2 landscape. According to the announcement, the decision to shut down was driven by declining activity, increasing costs, and intensifying competition from larger platforms such as Coinbase and Robinhood, which have built their own networks. At its peak, Blast held over $2 billion in total value locked (TVL), but that figure has since plummeted by 98%.

The shutdown highlights the challenges facing smaller layer-2 projects as major exchanges and financial platforms enter the space. It remains unclear what will happen to remaining assets on Blast or how users will be able to withdraw funds. The development could signal further consolidation in the Ethereum scaling ecosystem, with users gravitating toward more established networks. Incisor News will continue to monitor the situation for updates on asset recovery and the project's wind-down process.