The Binance cryptocurrency exchange, which is rated tops by CoinMarketCap for its daily volume, is set to have another token burn on the 18th of July.

Coin burning has to do with teams sending tokens to a wrong/invalid wallet address which cannot be accessible by anyone. This process is undergone to reduce the number of tokens already in circulation to a much lesser quantity.

This concept of reducing coins available to be supplied has been effective in driving up demand which also affects the coin’s price positively.

Binance (BNB) tokens are ERC20 tokens. Owning these tokens are of benefits to Binance cryptocurrency exchange users as they get a 50% reduction on transaction fees on the platform when trying to exchange one coin for another.

The token burn event is periodical. As clearly stated in the whitepaper, Binance will set aside 20% of profits made on the exchange and will buy back the BNB tokens from the community to be burned. This will continue until 50% of total supply of the BNB tokens are burned.

“Every quarter, we will use 20% of our profits to buy back BNB and destroy them, until we buy 50% of all the BNB (100MM) back. All buy-back transactions will be announced on the blockchain. We eventually will destroy 100MM BNB, leaving 100MM BNB remaining.”

Records show a decline in BNB price before token burn and a sharp rise, sometimes gaining over 50% shortly after the token burn has taken place. The first BNB burn was done on the 18th October 2017. A total of 986k tokens were burned at the time.

The first BNB coin burn took place on 18th October 2017. In the initial burn, 986,000 BNB tokens were burnt. This did not have much effect on the price of the BNB token, which was trading at around $1.31 on the day of the burn. The price of Binance coin steadily moved downwards until the coin burn took place.

Up until now, about 5 million tokens have been burned. That leaves coins to be burned at over 95 million BNB tokens. The number of tokens that will be burned this time is yet to be known.

The post Binance Schedules Coin Burn For July 18th appeared first on ZyCrypto.

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