Cryptocurrency leader Binance has recently finished its 27th quarterly burn of its native token Binance Coin (BNB). This routine event of burning tokens took out a substantial sum from circulation, totaling $1.17 billion worth of BNB, which accounts for about 1.3% of the total supply.
The previous burn was in January eliminating approximately 2.14 million BNB worth $636 million from circulation representing 1.38% of the total circulation.
These moves follow Binance’s commitment to burning tokens began at the launch of BNB in 2017. Back then, they pledged to destroy half of the total supply (100 million coins) through this process.
The burning process aims to combat inflation within the BNB ecosystem by permanently eliminating a predetermined amount of tokens. However, this time, the burn did not include the Pioneer Burn Program, a separate initiative that potentially involved burning tokens related to lost assets.
Despite the substantial token burn, the news failed to generate a positive price response for BNB. As per CoinMarketCap data, the token’s price dipped by 1.49% in the past 24 hours, falling to $597.67. In contrast, the weekly price surged by 14.78% defying negative news regarding a potential jail sentence for Binance founder Changpeng Zhao.
The market capitalization of BNB also reflected a slight decline, dropping by 2.77% to $88.21 billion. Trading volume, on the other hand, saw a modest increase of 1.4%.
These burns occur every quarter and are calculated using a pre-determined formula, ensuring transparency and eliminating any potential manipulation by the exchange.
Furthermore, BNB Chain, the blockchain that powers BNB, continuously burns a portion of the gas fees collected on the network in real-time.
It remains to be seen whether the price of BNB will eventually react to this latest burn. While the long-term goal is to increase the value of the token through scarcity, short-term price movements can be influenced by various factors, including broader market trends and negative news.
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