#BTCHashratePeak

Token Burn is the permanent removal of a certain number of tokens from circulation, aimed at reducing supply and increasing the value of the remaining tokens (theoretically). This process is similar to "destroying" tokens, and they cannot be recovered after burning.

Here’s a simple explanation of how burning works:

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🔥 How are tokens burned?

1. Sending tokens to an unusable address

Tokens are sent to an address known as a "burn address."

This address does not have a private key owned by anyone, making the tokens sent to it unrecoverable.

Example of a common burn address in Ethereum:

0x000000000000000000000000000000000000dEaD

2. Updating the smart contract

Some projects program a function in the smart contract that reduces the total supply upon burning.

This function can be:

Automatic (executed on every transaction)

or Manual (executed by the administration at a certain time)