Why is there no built-in option to blur the wallpaper?
Unfortunately, Android does not offer a blurring mechanism for launchers (Android 12 introduced blur support but not for only blurring the wallpaper). We could implement our own solution, but Niagara Launcher would require the file access permission, and the workaround wouldn't work in Android's lock or recent screen and wouldn't support live wallpapers. However, we added a subtle tint effect behind the app list to increase readability without needing to blur the wallpaper.
Are there any alternatives?
Yes, if the tint behind the app list isn't enough for you, you can utilize various third-party apps to blur the wallpaper. We recommend either using Blur Wallpaper or Muzei Live Wallpaper. You can even go one step further and configure contextual blurring with an app called KLWP (so the wallpaper is only blurry if the app list is visible, for example). Here's how: KLWP Integration.