Then google came in and started penalizing web sites for outbound links.
Then everyone stopped the blogrolls and the webrings disappeared - and people even got stingy with linking to a site in a blog post.
Sure, blame 'shady seo' or what have you - and yeah that became a thing, but the real blame is google. Pushing sites down google was such a scary thing that wordpress took the previously-in-core linkroll out in future updates - even if you have a blogroll with just friends - it was removed - many did not know - and if you did, you had to go install a plugin to bring the functionality back.
Of course the better options would of been to just auto-nofollow tag all the blogroll links - share the web and not to worry about a google penalty or being associated with 'spooky sounds "bad nieghborhood" in google's alog-eyes'
I'd love to see web rings brought back with auto-nofollow added - and a stats system that was open to all who installed / used it for webring X Y or Z - and blogrolls that are easy to nofollow.. better with hover preview / a note about why you love site Y or what have you.
It would be better for the web, but it's not easy to do currently and not a big benefit for the work right now.
Anyone remember when the search engines had a web ring to try the search at other engines at the bottom?