What is #Burn system in Cryptocurrency and its benefits, guide for a beginners. 👇🏽 #Crypto

A coin burn system in cryptocurrency refers to the removal of coins from circulation. This is usually done by sending coins to a special "burn address" a wallet that no one can access. Once coins are sent there, they’re essentially destroyed and can't be used again.

How it works:

⚡️A project decides to burn a certain amount of tokens or coins.

⚡️They send those coins to an address with no private key.

Benefits of a burn system:

1. Reduces supply

2. Increases scarcity

3. Boosts investor confidence

4. Used as a reward mechanism

Some projects burn coins as part of a profit-sharing system. For example, Binance burns #BNB quarterly based on trading volume.

5. Helps with price stabilization

Especially in new projects with high volatility, strategic burns can help manage price fluctuations.