The creator of smart contract platform Cardano (ADA) is clearing the air on the crypto project’s stance on burning tokens.
In response to a social media user who had accused him of “ignorance,” Charles Hoskinson says that burning coins is tantamount to destroying other people’s property.
Hoskinson says there aren’t any ADA reserves available to remove from circulation by sending them to an unusable wallet address.
“The astonishing power of ignorance is revealed when people cannot grasp that there is no magic reserve of ADA floating out there. All ADA is in the hands of owners, actual people, to burn it would require it be taken from them and destroyed.”
According to Hoskinson, other crypto projects that regularly burn coins to reduce supply usually do so from pre-mined reserves of their respective digital assets, not from the stashes of investors.
“Usually there is some large pre-mine that the founders control and destroy to manipulate the price during periods of lower liquidity. ADA does not have this.”
Responding to another social media user who suggested cutting Cardano’s staking rewards and burning that portion to reduce ADA’s supply, Hoskinson says that such an action would also amount to stealing from the ecosystem’s participants.
“That would be stealing from the ADA holders and stake pool operations. They earn those rewards.”
Cardano is trading at $0.45 at the time of writing, down by less than a percentage point over the past seven days.
The crypto project has set a maximum supply cap of 45 billion while its current supply is nearly 34.3 billion.
Don't Miss a Beat – Subscribe to get email alerts delivered directly to your inboxFeatured Image: Shutterstock/Jurik Peter/tanatpon13p