The BNB Foundation has completed the 28th quarterly token burn on the BNB Chain, further reducing the total supply of BNB tokens.
The burn saw a total of 1,643,698.8 BNB tokens being removed from circulation, BNB Chain said in a Monday blog post.
The platform added that the approximate value of the tokens stood at around $971 million at the time of the burn.
BNB Serves as Native Coin of BNB Chain
BNB serves as the native coin of the BNB Chain ecosystem, playing a crucial role in powering its multifaceted Web3 environment.
It facilitates transactions on the BNB Smart Chain (BSC), opBNB L2s, and BNB Greenfield blockchain.
Additionally, BNB holds governance utility, enabling holders to participate in the decentralized on-chain governance of the BNB Chain.
The Auto-Burn system implemented by BNB gradually reduces the token’s total supply to 100,000,000 BNB.
The burn amount is adjusted based on the price of BNB and the number of blocks generated on the BSC during each quarter.
Unlike previous quarterly burns, the recent burn, as well as future burns, will occur directly on the BSC due to the ongoing BNB Chain Fusion.
In addition to the quarterly burns, BNB implements a real-time burning mechanism based on gas fees.
BSC validators determine the ratio of gas fees collected in each block, which is then burned at a fixed rate.
Since the introduction of BEP95, approximately 234,000 BNB tokens have been burnt through this mechanism.
The BNB Pioneer Burn Program is another noteworthy initiative that supports users in recovering lost BNB and pegged tokens due to honest mistakes.
The program covers these losses through quarterly token burn events, providing a safety net for users within the ecosystem.
Does BNB Burn Impact Price?
By reducing the total coin supply, the BNB Foundation aims to create a deflationary mechanism that supports the token’s value over time.
Economic theory suggests that deflationary currencies with a fixed or dwindling supply tend to hold or gain value better than inflationary assets.
As BNB coins are destroyed, the remaining coins become scarcer and theoretically more valuable.
This deflationary dynamic can initiate a reinforcing cycle. Higher prices incentivize increased usage of BNB across the Binance ecosystem, driving up demand.
As demand strengthens, the rising value validates the token’s worth, attracting new users and traders. This, in turn, further reduces the supply as more coins are locked permanently through burnings.
However, there are no guarantees of a price increase, and much depends on wider adoption and market conditions.
It is worth noting that BNB Chain has announced a Meme Innovation Campaign in a bid to attract meme coin developers as the popularity of meme tokens continues to soar.
In a recent post on X, the network revealed that it is setting aside up to $1 million to reward eligible developers who deploy their memecoin projects on the network.
We’re thrilled to announce the BNB Chain Meme Innovation Battle where up to $1M is up for grabs!
This is an exciting opportunity for developers and creators to showcase their creativity and compete for amazing rewards.https://t.co/6acfjHVimX
— BNB Chain (@BNBCHAIN) April 2, 2024
The post BNB Chain Burns 1.6M BNB Tokens as Part of its 28th Quarterly Token Burn appeared first on Cryptonews.
