The burn mechanism is based on BNB’s price and the number of blocks generated on the BNB Smart Chain (BSC) during the quarter.
In a recent update, Binance, a leading crypto exchange, announced that they have executed a planned token burn, effectively removing over $450 million worth of its tokens from circulation. This process, known as burning, involves transferring tokens to an address that is not controlled by anyone, permanently reducing the overall supply. This action aims to increase the value of the tokens for holders by decreasing the available supply.
BNB serves as the native coin for the Binance Chain ecosystem, including the BNB Beacon Chain and BNB Smart Chain, and was initially introduced through an initial coin offering in 2017. To maintain a target total supply of 100 million tokens, an auto-burn mechanism is utilized. The auto-burn system adapts the amount of tokens to be burned based on factors such as the token price and the number of blocks generated on the tokens Smart Chain during each quarter.
As of the Asian afternoon hours on Monday, BNB was trading at $212, reflecting a 2% increase in value over the past 24 hours, according to available data.