Ethereum layer 2 Blast is shutting down because its maintenance costs now exceed the revenue the chain generates, the team announced on X on Friday, giving users until Oct. 26 to withdraw their assets to Ethereum mainnet.

"Unfortunately, the economics of operating the chain no longer make sense: the ongoing costs of maintaining Blast exceed the revenue generated by the L2, and we do not see a credible path to making the chain economically sustainable," the team wrote.

The shutdown order covers all funds on the network, including assets held in the Blast progressive web app (PWA). Blast was created by Tieshun "Pacman" Roquerre, the founder of NFT marketplace Blur.

How will withdrawals work?

Blast laid out a two-stage exit process. As a first step, the team will withdraw the chain's assets from Lido, the liquid staking protocol that underpinned Blast's native-yield model. The team expects that unwinding to take about one week.

Withdrawals will be unavailable during that period. Once they resume, Blast will cut its withdrawal delay to 24 hours to speed up exits. Users have until Oct. 26 to withdraw through the regular Blast interface.

After that deadline, funds remain recoverable only through direct interaction with Blast's bridge contracts on Ethereum. The team said it will publish detailed instructions before the deadline passes.

What is the scale of the wind-down?

The numbers trace an unusually steep decline. When Blast opened for deposits in November 2023 — with withdrawals disabled — it attracted $300 million within days, backed by a $20 million investment from Paradigm and Standard Crypto.

Mainnet launched in February 2024, and the BLAST token debuted in June 2024 at an initial fully diluted valuation of $2 billion.

According to DefiLlama, DeFi applications on Blast held about $32 million in total value locked on Friday, down from a peak of roughly $2.26 billion in June 2024. L2Beat counted about $90 million in total value secured on the chain, of which around $50 million entered through Blast's canonical bridge.

The BLAST token traded near $0.00028 on Friday, down about 32% over 24 hours and roughly 99% below its June 2024 high, according to CoinGecko. Market capitalization stood at about $20 million.

Why did the model fail?

Blast's core pitch was native yield: ether and stablecoins bridged to the network were automatically staked, with the resulting interest flowing back to users. That mechanism relied on Lido staking returns covering the chain's operating costs — a balance that no longer holds as on-chain activity and fee revenue contracted.

The team framed the closure as an orderly wind-down rather than an abrupt exit. "We're sorry to the users and developers who believed in Blast, built on it, and supported the ecosystem," the team wrote, adding that its priority is making the shutdown "as smooth and safe as possible."

The operational burden now shifts to users. Anyone holding assets on Blast faces a hard practical deadline of Oct. 26 for interface-based withdrawals, after which recovery requires direct contract interaction on Ethereum mainnet — a technically riskier path that will test how well the team's promised instructions prepare less sophisticated holders.