Binance has burned (removed from circulation) approximately $400 million worth of BNB in its 16th quarterly token burn event. Considering the exchange pledge to burn 20% of its profits every quarter, the latest burning suggests that the exchange potentially profited by $2 billion during the second quarter of 2021.
What you should know
On July 18, Binance reported that it had destroyed 1,296,728 BNB tokens valued at approximately $390 million as of the time of writing this report, with a current market price of $300 per BNB.
The exchange noted an additional 5,163 BNB were destroyed through its Pioneer Burn Program that aims to help users who have lost tokens through honestly mistaken transactions on their smart contracts platform, the Binance Smart Chain (BSC). Binance covers the losses, returning the tokens to users under specific circumstances. These token numbers are then deducted from the quarterly burn totals by the exchange.
READ: The United Kingdom bans Binance Cryptocurrency Exchange
Binance CEO, Changpeng Zhao tweeted “In summary: 1,296,728 #BNB (390,855,150 USD) burned by @Binance. The remaining 16m BNB unlocked, and moved to a team address, according to the schedule in the white paper. #Binance team has never used or sold a single team #BNB thus far, only burned them.”
The latest burn is the second largest in Binance Coin’s history by fiat value, with a whopping $600 million worth BNB having been destroyed in March. This represents a 33.33% decline.
The decline in the token burned is attributable to numerous factors such as market decline that has made investors more cautious, the regulatory crackdown on the exchange and also FUD (Fear, Uncertainty and Doubt) over the future of the exchange.
Despite the scale of the burn, the event appears to have had little impact on the Binance Coin markets, with BNB prices trending sideways over the weekend.
READ: Binance under investigation by the US justice department
Bottomline
Binance has recently been battling regulators on multiple fronts, with significant regulatory pressure coming from the United Kingdom, Germany and Hong Kong. In the U.K, several high street banks have restricted their customers from using the exchange as the country’s financial regulator clamps down on unregulated cryptocurrency trading platforms. Also, Binance suddenly halted the sale of its stock tokens. These regulatory pressures do not speak well for the exchange but at the Binance anniversary party last week, CEO Changpeng Zhao stated that the firm had increased its compliance team strength by 500% and he intends to increase this capacity by another 1000%.
BNB is currently down 2.28%, currently trading at approximately $300 as of the time of writing this report. It is currently down 56.26% from its all-time high of $686 but is still up by 700% Year-to-Date (YtD).
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