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Cryptocurrency exchange Bitget has completed the initial burn of BGB Tokens, reducing the total supply of BGB by 40% in an effort to increase its long-term value.
BGB is an ERC-20 Token that operates on-chain the Ethereum blockchain.
All About Bitget’s Token Burning
On December 30, Bitget Notification that burned 800 million BGB Tokens, reducing the total supply from 2 billion to 1.2 billion Tokens. The burned tokens were worth nearly 5 billion USD.
“The completion of Bitget’s first BGB burn, with 800 million tokens burned, representing 40% of total supply, marks a turning point on the journey to building a sustainable and impactful Token economy for BGB. This move is in line with Bitget’s goal of building long-term user value through maintaining transparency and providing high usability for BGB,” said Bitget CEO Gracy Chen.
Token Burning is the process of permanently removing an amount of Cryptocurrencies from circulation by depositing them into a wallet that cannot be spent or recovered.
This move is an attempt to control the price of the Token. Many Cryptocurrency groups burn Tokens to maintain demand, and Token prices increase over time.
For example, the price of memecoin BONK increased 25% in July following the proposed burn of 84 billion tokens from the Bonk DAO fund.
Bitget has also proposed a quarterly BGB burning mechanism that will begin in 2025. According to this plan, Bitget will use 20% of quarterly profits from exchange and wallet operations to buy back and burn BGB Tokens.
After each buyback, the purchased BGB Tokens will be destroyed by sending to the burn address.
Separately, earlier this week, Bitget announced it would merge two of its tokens, Bitget Token (BGB) and Bitget Wallet Token (BWB). This news even caused BGB to reach an all-time high of $8.49.
BGB was the best-performing Cryptocurrency in December, as its price increased more than 260% in 30 days. On December 1, BGB was trading around $1.60. According to TradingViewat the time of writing, this Token is trading at 5.75 USD.
With a market capitalization of $8.56 billion, Bitget Token is currently the 25th largest Cryptocurrency.
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