Binance burns $ 393.6 million in BNB tokens
Binance Cryptocurrency Exchange announced completing its 16th BNB token engraving.
He destroyed nearly 1.3 million tokens with a cumulative value of $ 393 million.
After launching its native token, the world’s largest stock exchange in terms of reported transaction volumes has pledged to burn half of its outstanding supply (100 million BNB).
Binance was burning 20% of its quarterly profits, according to the initial version of the BNB whitepaper. However, since last summer, this is no longer the case.
The current version of the white paper states that the number of tokens that Binance destroys each quarter is determined by the transaction volumes on its crypto-to-crypto platform that were recorded in the previous quarter:
Each quarter, we will destroy BNB based on the volume of transactions on our crypto-crypto platform until we destroy 50% of all BNB.
In the last quarter, Binance burned a record BNB $ 595 million. FTX CEO Sam Bankman-Fried speculated that the stock market’s earnings for this quarter could reach $ 750 million.
The second quarter burn percentage remains uncertain as Binance does not publicly disclose such numbers.
Binance was open on the matter in its January report. blog post, which explains why the “accelerated burn” was necessary in order to considerably speed up the process. Otherwise, it would take 27 years to achieve the aforementioned goal of destroying half of the token’s total circulating supply to come to fruition.
No price increase
By permanently removing its native tokens from circulation, Binance is making the remaining tokens scarce.
While the gigantic token burn is undeniably bullish for BNB, the cryptocurrency barely budged on the announcement. It is currently stable at $ 302, according to the BinanceUS exchange.
Nonetheless, Binance Coin remains one of the best performing cryptocurrencies of 2021. It is still up 753% since the start of the year despite falling 56% from its May high.