The deflationary mechanism of BNB: How does token burning affect the price?
Binance regularly implements the BNB burn plan, which involves repurchasing and burning a portion of BNB using profits to reduce market circulation. As of 2024, millions of BNB have been burned, reducing the total supply from 200 million to a lower level. This deflationary mechanism is similar to stock buybacks and theoretically can enhance the value of the token. Each burn announcement often triggers a short-term market increase, but the long-term price still depends on the overall ecological development. Investors need to pay attention to the burning pace and Binance's business growth to assess the potential appreciation space of BNB.