Leading cryptocurrency exchange Binance has announced that its latest quarterly $BNB token burn has seen it destroy more than 2.06 million tokens, worth over $600 million at the time of writing.<\/p>\n
According to Binance\u2019s announcement, a total of 2,064,494.32 BNB were burned in a transaction, with a total of 7,181.03 tokens being burned from the cryptocurrency trading platform\u2019s Pioneer Burn Program, in which Binance counts as burned BNB tokens that users have lost after mistakenly sending them to unrecoverable addresses, and cover their losses with BNB that was set to be burned. and 2,057,313.29 BNB being burned as part of the auto-burn system.<\/p>\n
Binance\u2019s $BNB burning mechanism is meant to help reduce the cryptocurrency\u2019s supply from 200 million to 100 million over time. The mechanism has suffered numerous changes over time, in part to help accelerate burns after $BNB\u2019s price surged.<\/p>\n
So far, the cryptocurrency exchange has managed to burn 21% of its total burning amount.<\/p>\n
It\u2019s worth noting burning tokens involves sending them to black hole addresses, or addresses that aren\u2019t controlled by anyone on the network. As no one controls these addresses, the tokens in them are permanently removed from circulation, and reduced a cryptocurrency\u2019s circulating supply.<\/p>\n
Aside from Binance\u2019s quarterly auto-burns, the BNB Chain, the native network of the $BNB token, has introduced in October 2021 BEP-95, which adds an additional deflationary aspect to the cryptocurrency by burning a fixed ratio of each block\u2019s gas fees that validators collect.<\/p>\n
The exact ratio being burned through BEP-95 is determined by on-chain governance mechanisms, and these burns are set to keep on occurring even after Binance reaches its goal of burning half of $BNB\u2019s total supply.<\/p>\n
Also read: Does Binance Have Deposit Limits?<\/p>\n
In its announcement, Binance detailed that since the introduction of BEP-95, a total of 145,000 tokens have been burned through the mechanism. In the last quarter, however, an incident affecting the BNB burn occurred, as an exploit of the BSC Token Hub bridge led to the creation of \u201croughly two million BNB.\u201d<\/p>\n
The minting of new tokens meant BNB\u2019s maximum supply has risen to 202 million, although the BNB Community\u2019s validators managed to burn 1.02 million of those tokens quickly. The remaining tokens are set to be burned through the burning processes described above.<\/p>\n