Blast Ethereum Layer-2 TVL Fall to $67M Could Raise Liquidity and Trust Concerns for Ethereum Ecosystem

• TVL fell from $2.2B (June 2024) to $67M (Aug 2025)

• Founder Pacman’s public silence coincided with accelerated withdrawals and trust erosion.

• Mass withdrawals triggered immediate liquidity shortfalls, destabilizing APR offers (4% ETH, 5% stablecoins).

Blast TVL decline: Blast Layer 2 TVL collapsed from $2.2B to $67M, causing a liquidity crisis — read analysis and recommended actions for investors.

What is the Blast TVL decline?

The Blast TVL decline describes the fall in total value locked on the Blast Ethereum Layer 2 network from over $2.2 billion in June 2024 to approximately $67 million by August 2025. The drop reflects widespread withdrawals, reduced liquidity, and deteriorating investor confidence in the protocol.

Why did Blast’s TVL drop so sharply?

Mass withdrawals were the primary driver. Large-scale exits overwhelmed available liquidity, removing collateral and destabilizing APY incentives that previously attracted deposits. Founder Pacman’s lack of public communication amplified uncertainty; as industry observers note, “The simultaneous silence of founders and sudden outflow of capital demonstrate the fragility of trust in DeFi Layer 2s.”

How has the decline affected users and dApps?

The liquidity shortfall disrupted ETH-based dApps and pools relying on Blast’s bridges and rollups. Financial offers such as 4% APY on ETH and 5% on stablecoins became unsustainable, prompting rapid re-pricing and withdrawal cascades. dApp operators reported increased failed transactions and higher slippage across affected pools.

When did the collapse accelerate?

TVL held above $2 billion through mid-2024, then began a multi-stage decline. The steepest outflows occurred in mid-2025, culminating in the $67 million figure reported in August 2025. Withdrawal volumes and on-chain metrics indicate concentrated exits in short windows, consistent with liquidity runs.

Frequently Asked Questions

How much did Blast’s TVL decline in total?

Blast’s TVL declined from over $2.2 billion in June 2024 to about $67 million in August 2025, a reduction exceeding 96% of locked capital over a 14-month period.

What role did founder silence play in the crisis?

Founder Pacman’s lack of public updates increased uncertainty, reducing the likelihood of coordinated liquidity management and accelerating withdrawals as stakeholders sought to preserve capital.

What symptoms did the market observe during the outflows?

Symptoms included rapidly falling on-chain liquidity, higher slippage for swaps, paused or failed transactions for dApps using Blast, and unsustainable APY offers that were quickly re-priced downward.

Key Takeaways

• Massive TVL collapse: Blast’s TVL fell from $2.2B to $67M, exposing systemic liquidity weakness.
• Leadership and communication matter: Founder silence intensified trust erosion and accelerated capital flight.
• Immediate action required: Users should audit exposure, pause new deposits, and prioritize withdrawals or migrations.

Conclusion

The Blast TVL decline illustrates how concentrated liquidity and leadership silence can transform a high-profile Layer 2 into a liquidity crisis. Stakeholders should act quickly to assess exposure, follow verified on-chain data, and demand transparent remediation plans. COINOTAG will continue monitoring developments and reporting verified updates.