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Bullish
What does "token burning" mean in crypto?.
Many hear it, but few really understand what it implies.
Token burning is a process by which a project permanently removes a certain amount of tokens from circulation.
This is done by sending them to an inaccessible wallet (also called a black hole or burned wallet).
What is this for?
It reduces the total supply of the token, which can influence its value, depending on demand.
It is similar to when a company buys back shares and then removes them from the market.
Not all projects burn tokens, and it does not always have an immediate impact on price.
It is important to analyze the context and strategy of the project.
Real example:
BNB, the token from Binance, has a programmed quarterly burning mechanism.
This is transparently explained in its whitepaper.
If you are new, remember that understanding these concepts helps you make better decisions, even if you are just learning.
If you like what I share, I invite you to comment or share what has helped you the most.
If you follow me, I will follow you back too. 👉
📊 Check how the most traded pairs are doing by clicking here 👇
$BTC
$ETH
$BNB
#MarketRebound
#BinanceHODLerTOWNS
Many hear it, but few really understand what it implies.
Token burning is a process by which a project permanently removes a certain amount of tokens from circulation.
This is done by sending them to an inaccessible wallet (also called a black hole or burned wallet).
What is this for?
It reduces the total supply of the token, which can influence its value, depending on demand.
It is similar to when a company buys back shares and then removes them from the market.
Not all projects burn tokens, and it does not always have an immediate impact on price.
It is important to analyze the context and strategy of the project.
Real example:
BNB, the token from Binance, has a programmed quarterly burning mechanism.
This is transparently explained in its whitepaper.
If you are new, remember that understanding these concepts helps you make better decisions, even if you are just learning.
If you like what I share, I invite you to comment or share what has helped you the most.
If you follow me, I will follow you back too. 👉
📊 Check how the most traded pairs are doing by clicking here 👇
$BTC
$ETH
$BNB
#MarketRebound
#BinanceHODLerTOWNS
Disclaimer: Includes third-party opinions. No financial advice. May include sponsored content. See T&Cs.
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