There is no feature in iMovie that provides for blurring a clip. Some users have employed the Full Focus title to impart a slight blur to a clip, by overlaying the title and then deleting the text template from the title. Otherwise, the only way that I know of to blur a clip is to create a blur clip outside of iMovie, then import it into iMovie, and then overlay the blur onto the main clip in the timeline, using the Picture in Picture feature.
It might help if you could clarify exactly what effect you want to create. Do you want to blur the entire clip temporarily? Or just a portion of the clip in a fixed place? Or create an animated blur that will follow the action, such as blurring the license plate of a moving car?
-- Rich