Binance wants to increase the value of Binance Coin through a BSC fee burning proposal

Amid the ongoing rally in Binance’s native token, The developers of Binance Coin (BNB) and Binance Smart Chain (BSC) have proposed further measures to maintain the token’s deflationary model and increase its intrinsic value.

According to a new Binance Evolution Protocol, BEP-95, BSC developers are considering introducing a real-time burn mechanism for part of the gas tariffs in order to reduce the supply of BNB and increase the value of BNB through increasing demand. According to the BEP, the BNB owners decide how to send the BSC gas premium.

When the proposal was released on Friday, the BSC developers noted that the new BEP could reduce the total amount of BNB validators and delegates receive through staking. The burning mechanism is activated by entering adjustable parameters for two smart contracts in the system to record gas prices.

Binance wants to increase the value of Binance Coin through a BSC fee burning proposal
Binance wants to increase the value of Binance Coin through a BSC fee burning proposal

BNB was created by Binance in 2017 and is inherently a deflationary token, which means Binance burns a percentage of the BNB supply every three months to preserve the value of the token. Binance will stop burning BNB as soon as 50% of the original supply is burned and only 100,000,000 BNB are left.

The last BNB token burn happened last Monday, and Binance burned 1,335,888 BNB ($ 640 million) in its 17th quarterly burn.

The proposal comes amid the BNB, which recently saw a major rally with the token topping $ 500 on Wednesday.. At the time of this writing, BNB is the third largest cryptocurrency by market capitalization after Bitcoin (BTC) and Ether (ETH). The token is trading at $ 495, up around 44% over the past 30 days. The BNB’s all-time high was recorded in May 2021, with the token climbing as high as $ 686, according to CoinGecko.

The last BIP, which took place in August, resembles a new transaction fee mechanism implemented for the London upgrade from Ethereum. According to the Etherchain, The current average ETH burn rate is 3.76 ETH, or $ 15,448 per minute.

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