Binance Records Largest BNB Burn; CZ Says, “More Certain About The Future Of Crypto Than Ever”
Today, Binance announced the twelfth quarterly burn of its native token Binance Coin (BNB) which was the largest ever yet, reducing about 3.4 billion BNB from the circulation.
Not only was this the largest ever burn in terms of BNB supply but also in USD value at $60.5 million.
The leading spot crypto exchange first started burning the tokens in Q3 of 2017. At that time, the company was using 20% of Binance’s profits to buy those tokens and burn them. But last year in April, the company quietly removed the clause from the whitepaper.
This was to clarify that the exchange doesn’t actually repurchase BNB, but just burns it. Reportedly, because profits tend to be associated with securities, the changes were made. Now, the company burns the tokens based on trading volumes.
“The amount of BNB coins to be burned is based on the number of trades performed on the exchange within a 3-months period. So after each quarter, Binance burns BNB according to the overall trading volume.”
Given its record coin burn, the exchange saw a spike in volume. But while futures volume reportedly grew 68% compared to last quarter, spot trading volume saw a small decline of 4%.
But some argue, because they are just burning the premined tokens, it is basically “useless.”
“The BNB burning events are scheduled to take place every quarter until 100,000,000 BNB are finally destroyed, which represents 50% of the total BNB ever issued (200,000,000 BNB),” states Binance.
The 10th largest cryptocurrency by market cap of $2.6 billion, BNB is currently trading $17.16, up 23.19% YTD. According to Messari, it’s liquid supply is just over $108 million.
“Massive amounts of wealth are taken away from people and redistributed to a few selected groups by quantitative easing. Given the amount of printing for fiat, fiat currencies around the world will devalue against most hard assets. And for crypto currencies with limited supply, your guess is as good as mine as to what will happen to their adoption and price,” CZ said.
But even in these volatile times, he is “more certain about the future of crypto than ever.”