Cryptocurrency exchange Binance announced the sixteenth quarterly burning of Binance Coin tokens worth over $ 393 million. This amount includes 5163 BNB ($ 1.5 million). Which were withdrawn from circulation as part of support for users who mistakenly lost their coins by sending to a non-existent address. These funds were returned to the victims. And then the same number of coins were burned to keep the emission at the same level. A total of 1,296,728 BNB was burned in the last quarter.
It is worth recalling that when the token was launched, Binance announced that half of its BNB token, of the 100 million operating in the ecosystem, would be destroyed.
Each quarter, Binance uses 20% of its profits to repurchase and burn Binance Coin tokens. Thus, this will continue until the altcoin emission is reduced by 50%, to 100 million BNB. According to Coinmarketcap, there are 168 million BNB in circulation at the moment, worth $ 50.7 billion.
Binance CEO Changpeng Zhao stressed that the exchange team “never used or sold BNB, but only burned it”. The burning of tokens is the destruction of a certain number of them to reduce their emission. This method is used to combat inflation and increase the value of cryptocurrencies. All token burn operations are recorded on the blockchain as a transaction.
Therefore, anyone can verify that the coins have been destroyed.
In mid-May, Ethereum co-founder Vitalik Buterin burned 90% of the Shiba Inu tokens that were stored in his wallet by sending them to a non-existent address. In total, Buterin destroyed coins worth $ 6.5 billion. Against the background of the burning, the price of the altcoin rose sharply by 36%.
Other events related to Binance
The latest destruction was the second largest in Binance history in terms of fiat mone. With about $ 600 million worth of BNB destroyed at the time of the burn in March. In the third quarter of last year, Binance “burned” 2.2 million BNB worth $ 68 million.
Despite the scale of the latest BNB destruction, the event did not have much of an impact on the Binance Coin markets as the price of the crypto asset was in a sideways trend over the weekend. According to CoinMarketCap, on July 19, as of the first half of the day, BNB is trading at $ 298, showing a decrease of 2.2% per day.
At the end of last week, Binance announced the termination of trading in share tokens, without specifying the reason for this decision. Most likely, this is due to pressure from regulatory bodies. At the end of June, the UK FCA banned the exchange from providing some of the services. Around the same time as the FCA, the Japan Financial Services Agency (FSA) issued a warning that Binance operates in the country without a license and does not have regulatory approval to operate in Japan. Earlier this month, Thailand’s SEC accused Binance of illegal transactions. The Cayman Islands regulator announced that the exchange didn’t have a license. And Polish and Italian regulators warned against trading on the site.