Blast's Layer 2 network has shut down.
The official withdrawal interface expired on October 26, and around $40.4 million remains stuck in the cross-chain bridge. The remaining ETH and dollar-denominated assets can only be recovered through the official recovery site, which will remain open until November 4, 2027.
A month ago, Blast gave its own reason: operating costs exceeded Layer 2 revenue, so it was winding down gradually.
Similar things have been happening one after another this year. Kroma has ceased operations, Kinto has shut down completely, ENS has abandoned its own Layer 2 and moved all of v2 back to mainnet, Synthetix and Trueo have scaled back long-tail deployments, and Aave has shut down smaller deployments with little activity.
The reason is simple. After mainnet base fees fell to 0.06 Gwei, a transfer costs only a few cents. The fees saved by using Layer 2 no longer outweigh the risks of cross-chain bridges and fragmented liquidity.
ETH itself is paying the price. Token burns depend on base fees, and the burn-mint balance requires 13.63 Gwei. Fees are now two orders of magnitude below that level, and the network is seeing net issuance of about 2,954 ETH per day. The Layer 2 retreat is pushing applications back to mainnet, while mainnet's low fees have also snuffed out the deflationary narrative.
$ETH #Ethereum
The official withdrawal interface expired on October 26, and around $40.4 million remains stuck in the cross-chain bridge. The remaining ETH and dollar-denominated assets can only be recovered through the official recovery site, which will remain open until November 4, 2027.
A month ago, Blast gave its own reason: operating costs exceeded Layer 2 revenue, so it was winding down gradually.
Similar things have been happening one after another this year. Kroma has ceased operations, Kinto has shut down completely, ENS has abandoned its own Layer 2 and moved all of v2 back to mainnet, Synthetix and Trueo have scaled back long-tail deployments, and Aave has shut down smaller deployments with little activity.
The reason is simple. After mainnet base fees fell to 0.06 Gwei, a transfer costs only a few cents. The fees saved by using Layer 2 no longer outweigh the risks of cross-chain bridges and fragmented liquidity.
ETH itself is paying the price. Token burns depend on base fees, and the burn-mint balance requires 13.63 Gwei. Fees are now two orders of magnitude below that level, and the network is seeing net issuance of about 2,954 ETH per day. The Layer 2 retreat is pushing applications back to mainnet, while mainnet's low fees have also snuffed out the deflationary narrative.
$ETH #Ethereum
