Binance is approaching the quarterly coin buyback and burn of its Ethereum-based token Binance Coin (BNB).
Here’s a look at how the coin burn works, according to the company’s whitepaper:
“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.”
Binance initially created 200 million BNB and promised no more coins would ever be generated. The structure is designed to help make the coin an attractive investment due to its inherently deflationary nature.
So far, Binance has executed three coin burns three months apart. The first was on October 18th of last year, when 986,000 BNB coins were burned.
The next burn came on January 15th of this year, and eliminated 1,821,586 BNB from the supply.
Three months later, the third coin burn hit, with 2,220,314 BNB burned on April 15th.
If past is prologue, the next burn will happen in about a week, between Sunday, July 15th and Wednesday, July 18th.
This year, Binance Coin has ignored the bearish trend in the market and has gone its own way. The coin started the year at about $8.25 on January 1st. It’s now $13.99 on CoinMarketCap, at time of publishing – a gain of about 69%.