At 11:29 Beijing time on July 18, 60 million USDC was burned in the USDC treasury.
This burn is equivalent to nearly 60 million USD, reflecting the management of circulation and reducing the supply of USDC tokens in the market.
MAIN CONTENT
60 million USDC was burned exactly at 11:29 Beijing time on July 18.
Information confirmed through Whale Alert, demonstrating transparency in USDC treasury management.
Why did USDC Treasury proceed to burn 60 million USDC?
CEO of Circle – the company that issues USDC – has repeatedly affirmed that token burning is a normal action aimed at adjusting the circulating supply, avoiding the situation of issuing beyond actual demand. This also helps maintain the value stability of the USDC within the cryptocurrency ecosystem.
When the circulating USDC is culled, it balances the total supply, limiting the risk of token inflation. According to Circle's official report, token burning does not affect smart contracts or linked reserve assets.
Token burning is an important step in supply management to maintain the value of USDC, as well as to ensure transparency and safety for users globally.
Jeremy Allaire, CEO of Circle, speaks in 2023
How does token burning affect the cryptocurrency market?
Effective management of USDC token supply has a significant impact on liquidity and investor confidence in the DeFi and CeFi ecosystems. Reducing the token supply through burning is often accompanied by maintaining corresponding reserve assets, thereby stabilizing value and limiting unusual fluctuations.
A study by the leading cryptocurrency research firm Messari in 2023 shows that stablecoins with strict supply management will maintain a higher level of stability, thereby enhancing user experience and promoting sustainable ecosystem growth.
What does burning 60 million USDC mean for USDC users?
USDC users can rest assured that the burned tokens demonstrate that token issuance is always tied to 1:1 reserve assets, minimizing price volatility risk. At the same time, this affirms the transparency of the issuing organization in financial management, reinforcing user trust.
This action also warns investors to closely monitor supply and demand metrics to optimize staking, yield farming, or stablecoin investment strategies.
We commit to maintaining a perfect balance between circulating tokens and reserve assets to protect investors and enhance market stability.
Jeremy Allaire, CEO of Circle, 2023
What are the popular token burning methods today?
Stablecoin issuers often use token burn methods by reclaiming and permanently deleting on-chain tokens, while adjusting the corresponding reserve asset balances at the treasury. This is the chosen mechanism to ensure that no tokens are in circulation illegally or above the regulated amount.
On-chain tools allow for transparent tracking of this process through cold and hot wallet transactions, ensuring complete documentation for audits and continuous reporting.
Can we compare the USDC token burn mechanism with other stablecoins?
Criteria USDC Stablecoin A Stablecoin B Burn Method Reclaiming tokens and burning on the blockchain, adjusting reserve assets Automatic token burning through smart contracts Reclaiming tokens and reinvesting in reserve treasury Transparency Public announcement via Whale Alert and monthly reports Irregular reports On-chain transparency but not fully disclosing financial data Market Impact Value stability and synchrony with 1:1 reserve revenue May create volatility due to improper refinancing Relatively stable but does not prioritize transparency efficiency.
Frequently Asked Questions
Does burning USDC decrease the value of the token?
No. Burning helps control the token supply reasonably, maintaining a 1:1 reserve asset, increasing stability and investor confidence.
How to verify token burn events on the blockchain?
This can be checked through on-chain transaction tracking services like Whale Alert or public blockchain explorer platforms.
How does token burning affect users holding USDC?
This helps maintain stability in value, reduces volatility risk, and reinforces the safety of user assets.
Is the token burning process publicly transparent?
Major issuers publicly report and provide detailed data on their official websites and to regulatory organizations.
Does token burning have to occur regularly?
It usually occurs according to the need to adjust supply and demand to maintain balance and stabilize the ecosystem, not always regularly.
Source: https://tintucbitcoin.com/60-trieu-usdc-bi-pha-huy/
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