He got released because he can't play. If he could play, the Broncos are smart enough to restructure his deal to keep him. They found out that he's not "Terrell Buckley" light as they thought he was when they initially signed him, so the cut their losses. Like the well run organization that they are.
Bly sucks and the BILLS should stay away from him. He can't tackle and his fundamentals at the position are woeful. For every "big play" he makes, he misses 10 tackles or turns out when the play comes to his side. Jabari Greer is twice the corner Bly is at this point, is younger and likely cheaper.