Binance, the largest cryptocurrency exchange by volume, announced it had implemented its first-ever Binance token (BNB) auto-burn program last quarter, where 1,684,387.11 BNB tokens worth $783 million were removed from circulation.
Under the new program, the number of tokens to be burned is arrived at using a formula based on the total number of blocks produced on the Binance Smart Chain, a blockchain with smart contracts functionalities and running parallel to Binance Chain, and BNB’s average dollar-denominated price during the quarter.
Cryptocurrency tokens or coins are considered “burned” when they have been purposely and permanently removed from circulation. Token burning is usually performed by the development team behind a particular cryptocurrency asset. It can be done in several ways, most commonly by sending the coins to a so-called “eater address” where its current balance is publicly visible on the blockchain, but access to its contents is unavailable to anyone.