Binance’s 25th quarterly BNB token burn of 2.14 million tokens boosts its price by 3% and reduces circulating supply.
Changpeng “CZ” Zhao, the CEO of Binance, announced a significant milestone for the cryptocurrency exchange. On October 16, Binance conducted its 25th quarterly BNB token burn, a process that involved destroying 2.14 million BNB tokens. Valued at around $453 million, this move led to an immediate positive response from the market, propelling the BNB token price upwards by 3% within a single day.
Binance’s Token Burning Mechanics
To understand the gravity of this event, it’s essential to delve into the mechanism that Binance employs for its token burns. This mechanism, known as BNB Auto-Burn, calculates the amount of BNB tokens to be destroyed every quarter. The protocol factors in the current BNB price and the number of blocks generated on the Binance Smart Chain (BSC) during that period. This quarter’s token burn also featured an additional 314.69 BNB tokens incinerated through the Pioneer Burn Program.
Binance has been consistent with its quarterly burns, having destroyed a staggering total of 50.29 million BNB tokens thus far. The ultimate goal of these burns is to reduce the circulating supply of BNB tokens to under 100 million. According to the most recent data, the circulating supply stands at 151,705,885 BNB tokens.
Impact on BNB Price and Future Prospects
The immediate market reaction to the 25th quarterly burn was palpable. The BNB token price saw a 3% increase, trading at $213 with a 24-hour trading volume up by 82%. This uptick underscores the heightened interest in BNB among traders and investors alike. Additionally, the 24-hour trading range for BNB was $206.66 at its lowest and $213.92 at its peak.
Adding to the optimism, Binance’s CEO pointed out that BNB is becoming deflationary due to the ongoing burns, a factor that could positively impact its value over time. Projections for the 26th quarterly BNB burn suggest that even more tokens will likely be destroyed, as estimates point to around 2,180,464 BNB for the next event.
By strategically reducing its circulating supply, Binance continues to affirm its position as the world’s leading cryptocurrency exchange. As the market responds positively to each burning event, Binance appears to be on a path toward creating increasing value and scarcity for its native BNB token. Keep your eyes peeled for the 26th burn, as the ongoing trend indicates that Binance has no intention of slowing down anytime soon.