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Binance Coin (BNB), one of the leading projects in the cryptocurrency world, plays an important role in the Binance ecosystem. In particular, the “coin burning” process stands out as an important mechanism that contributes to the value of BNB. So, what is the BNB coin burning process and why is it so important? Here are the details.
What is BNB Coin Burning?
The “coin burning” process is the name given to the process of permanently removing a certain amount of coins from circulation in order to reduce the total token supply in the market. This process can lead to an increase in price within the framework of the supply and demand balance and help the assets of existing coin holders become more valuable. Coin burning transactions for Binance Coin (BNB) are carried out at regular intervals as part of the activities in the Binance ecosystem.
BNB’s coin burning transactions have been on the roadmap since the early days of the Binance exchange and have been a regularly implemented strategy. Binance aims to burn 50% (100 million BNB) of the total BNB supply of 200 million.
BNB Coin Burn Dates
Binance Coin burns are based on a percentage of the profits earned by Binance. Each quarter, Binance burns a certain amount of BNB tokens, thereby reducing the total BNB supply in circulation. Below are the coin burn dates and BNB amounts burned in recent years:
1. 15th Coin Burn – October 16, 2019
Amount of BNB Burned: 2,061,888 BNB
This burn was recorded as one of the largest burns at the time. Binance has continued its policy of increasing burn rates as the market size increases.
2. 16. Coin Burn – January 18, 2020
Amount of BNB Burned: 3,373,988 BNB
This burn, which took place in the first quarter of 2020, allowed more BNB to be withdrawn from circulation compared to previous burns.
3. 17. Coin Burn – April 17, 2020
Amount of BNB Burned: 3,373,988 BNB
During this period, Binance accelerated its strategy of reducing coin supply by continuing BNB burns more frequently and effectively.
4. 18. Coin Burn – July 16, 2020
Amount of BNB Burned: 3,477,388 BNB
Binance continued to burn regularly at the end of each quarter, and approximately $60 million worth of BNB was burned during this burn.
5. 19. Coin Burn – October 17, 2020
Amount of BNB Burned: 2,253,888 BNB
With this burning process, Binance has withdrawn 12.6% of the total supply from circulation.
6. 20. Coin Burn – January 19, 2021
Amount of BNB Burned: 3,619,888 BNB
While Binance’s quarterly burning policy continues in 2021, this process attracted attention as one of the largest burning processes made up to that period.
7. 21. Coin Burn – July 16, 2021
Amount of BNB Burned: 1,296,728 BNB
In 2021, burning processes were placed on a tighter schedule and notable amounts were removed from circulation in each quarter.
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The Importance of Coin Burning and Price Impact
Burning coins can have a positive impact on the BNB price in the long term. A decrease in supply leads to an increase in price if demand remains constant. This creates an important incentive mechanism for BNB holders, while also increasing trust in the Binance ecosystem.
In addition to regular burns, Binance works to ensure that BNB is more in demand within the ecosystem by developing new projects and uses. This strategy not only reduces supply, but also increases BNB’s functionality and usage on the Binance platform.
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