$778 Million Worth of BNB Has Been Destroyed in 19th Quarterly Burn

Key highlights:

  • More than 1.8 million BNB ($778 million) worth of BNB has been burned in the 19th quarterly burn
  • This was the second quarterly burn to follow the Auto-Burn model
  • In BNB terms, the burn was the latest burn was the largest since Q4 2020

Second-ever Auto-Burn removes $778 million worth of BNB from circulation

Approximately $778 million worth of BNB has been burned in the 19th quarterly BNB burn, which saw 1,839,786 tokens being removed from circulation. The latest quarterly BNB burn was the second to use the Auto-Burn model, which first came into effect in January this year. The wallet that burned the tokens now holds 16.4 million BNB, which translates to almost $7 billion. 

The USD value of the tokens burned in the latest BNB burn is comparable to the value of the tokens burned in the 18th quarterly BNB burn. In terms of the amount of BNB burned, the latest burn is the largest since Q4 2020. 

In the past, a large amount of BNB was also burned on a quarterly basis, but the quantity depended on various business metrics the Binance cryptocurrency exchange achieved in the quarter. In December 2021, these quarterly burns were switched over to an Auto-Burn model, which is based on metrics not related to the Binance exchange. The formula which determines how much BNB is burned in the new Auto-Burn model takes into account the number of blocks produced on BNB Chain during the quarter, as well as the average BNB price (denominated in USD) in the same time period. 

The Auto-Burn model will be in effect until the supply of BNB is cut down to 100 million tokens. This follows the original whitepaper Binance released for BNB, which set a goal of gradually halving the BNB supply from the initial 200 million tokens. Even when the Auto-Burn model is switched off, there will still be some deflationary pressure to the BNB supply thanks to the real-time BNB burn mechanism that has been implemented on BNB Chain. A portion of the gas fees collected in each block on BNB Chain is permanently removed from circulation, and this will continue even after the BNB supply is reduced to 100 million tokens.

BNB has seen a 5.8% gain in the last 24 hours, which has brought the token’s price back above the $400 mark. BNB’s performance today is roughly in line with the rest of the cryptocurrency market, as the total market cap is up 4.6% on the day. 

Source link: https://coincodex.com/article/14258/778-million-worth-of-bnb-has-been-destroyed-in-19th-quarterly-burn/

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