Many popular NFT collections have posted double-digit percentage losses in the past week as BLUR airdrop farmers offload their inventory.
With Blur Season 3 expected to end in the coming weeks, Ethereum-based NFTs are being sold off en-masse.
Season 3 is Blur’s ongoing airdrop farming campaign, where users are to be rewarded with [REDACTED], powered by Blast. Traders assume that this will be in the form of the Blast Layer 2 network’s upcoming token.
Blur users earn points by bidding on NFTs and providing loan liquidity through its lending infrastructure, Blend. Blur’s incentivized bidding and loan provision have been controversial as the liquidity isn’t representative of true demand and often results in the same NFTs being traded from farmer to farmer.
Some market participants feel this is negative for the space as a whole, as true collectors may be reluctant to enter the market when a substantial portion of supply is in the hands of farmers who can dump their NFTs at any moment, depressing prices.
Amidst the growing uncertainty, NFT traders and collectors are bracing for a potential further dip in prices after Season 3 concludes. The reduction in liquidity, if incentivized bidding is removed, is a key concern. Some Blur farmers are already taking preemptive measures by closing their NFT and Blur farm positions.
Many of the top Ethereum NFT collections, such as Pudgy Penguins, Bored Ape Yacht Club, and Milady Maker, are all down by between 6% and 30% over the last week as Blur farmers unwind their positions.
Meanwhile, notable NFTs that are not traded on Blur, such as CryptoPunks, are up slightly over the last week.
