In Its First-Ever Auto Burn, Binance Destroys 1.68 Million BNB Tokens

In December 2021, the world’s largest crypto exchange, Binance, announced the introduction of a new Binance Coin (BNB) Auto-Burn protocol

In December 2021, the world’s largest crypto exchange, Binance, announced the introduction of a new Binance Coin (BNB) Auto-Burn protocol to provide more “transparency and predictability” for its community.

The Auto Burn protocol automatically calculates how much BNB should be burnt based on BNB’s average dollar-denominated price throughout the quarter and the number of blocks produced on the Binance Smart Chain (BSC) over the same period.

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Although the Auto Burn protocol replaces the normal quarterly BNB burn, there is also a second burn mechanism on the BSC, which involves the real-time burning of a percentage of BNB gas fees on the chain.

Auto Burn Used to Destroy 

In its first quarterly BNB Auto-Burn (or the 18th quarterly burn), Binance announced that 1.684 million BNB (worth approximately $792 million USD) has been removed from circulation. The burn represents an amount equal to 0.84% of Binance’s initial supply. 

According to the announcement, 6296.305493 BNB was burned as a part of its Pioneer Burn Program. In addition, Binance has reassured users that 50% of its initial 200 million BNB will be burnt.

On the Flipside

  • The effect of deflation has been minimal on Binance Coin (BNB), which is 32.40% below its all-time high of $690.93 as of this writing.

Why You Should Care

With a fixed supply, these token burns are aimed at making BNB a deflationary asset and could possibly increase the appeal of the Binance Coin as a store of value.

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This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Milko Trajcevski

Milko Trajcevski is a DailyCoin news reporter, mainly focused on Ethereum (ETH), Cardano (ADA), and their founders (Vitalik Buterin and Charles Hoskinson). Milko is an avid follower of crypto and blockchain technology and has written thousands of articles on the subjects. He finds joy in transforming complex issues into written content that anyone can understand. Milko has used and analyzed numerous exchanges, such as Coinbase, FTX, and Binance. He also closely follows all of the latest news around the largest decentralized exchanges (DEXs). Location: Skopje, Macedonia