Binance confirmed that they are going to burn 32$ Million BNB coins
The exchange is burning out coins every fiscal quarter. They are ready for the 4th quarter massive coin burn for around 32.7$ Million BNB
On 16 July , Zhao tweeted about the final tally:
In accordance with the exchange’s whitepaper:
Every quarter the platform utilizes 20% of its profits to purchase back BNB at the market value and “burn” them, eliminating said tokens from the final circulating supply. This procedure completes after the burning of 50% of BNB, or approx. 100 million tokens.
Each quarter Binance utilizes 20% of its income to buyback BNB at the current market value and burn them, this way they ar e eliminating tokens from the circulating supply. The procedure completes once Binance burn 50% of its coins, around 100 million coins.
On the growth from Q1 2018 – Q2 2018, Zhao wrote:
This is the highest number of BNBs we have burned in a quarter so far. This is a result of the strong support from our community, you, and hard work by the team, including our Angels. Thank you so much!
The announcement says that Binance is planning to burn the coins within the next two days. According to Zhao, coin burn seems a better option than profit sharing. He wrote:
I also learned a shocking amount of people still don’t understand the concept of “burn”. Simply speaking, if someone destroys 10% of a currency (burn), that achieves the exact financial effect as spreading that 10% proportionally to the other 90% holders (usually called a dividend distribution).
The executive of Binance said that a coin burn is classified by fewer transactions and therefore, they end up holding lower fees. Also, the burns are unlikely to affect the network they are designed to clog on. Dividend issuance usually requires additional work and might end up with the regulatory issues in jurisdictions due to the strict tax laws.
What will be the response on the Binance fourth-quarter update? Share your response in the comment section below.