THE GREAT UPTOBER BURN OF 2021
As the extended swap window closed yesterday we are now one step closer to the one and only burn of $PAWTH tokens. The only thing left to do is vote on the proposal about team compensation in Snapshot: https://vote.pawthereum.com/#/proposal/Qmcw67GnudPrNU7h9hs2LGMNSdQYUoStYSD4nDbBHnbQ1g
On Friday, October 22nd, 2021 at 11 am UTC, the remaining $PAWTH coins in the original swap wallet will be burned.
It is certain that the final number will be at least 120 Million $PAWTH tokens which count for 12% of the total supply. A token burn is a process of sending a number of tokens to a wallet address — commonly referred to as the “black hole” — where the private keys are unobtainable by anyone. This process makes the tokens unusable forever and cannot be undone.
Here is a more detailed message about token burning explained by Stakin:
🔥 Token Burning?
The phrase “token burning” sounds more dramatic than it actually is. Token burning doesn’t require any actual dissolving of digital assets. Those of you familiar with blockchain will probably know that it is impossible to disintegrate assets because the underlying protocol is fixed. The blockchain protocol’s history and data are all locked in blocks, so it can’t be altered in any way.
So, if nothing gets actually burned, then what happens? Tokens or assets are algorithmically taken out of circulation by sending signatures to a public address known as an “address eater”. As with any other address the keys to this address can’t be obtained by anyone and are private. In a nutshell, when you send assets to this address, they are unrecoverable and can’t be used anymore.
Assets that are burned are recorded on the blockchain transparent ledger system to make sure all nodes can see it and confirm that the coins are indeed “burned”.
🤔 The reasons behind token burning
The most common reason for burning tokens is deflationary purposes. Most projects utilize it to make sure the value of their assets stays stable or accrues in value and therefore to create additional incentives for traders and holders.
All reasons to burn tokens are connected to the value it will have for the token holders. Often, protocols want to boost the value of each token by reducing the current supply. It’s all about supply and demand. If there are fewer coins available for sale and on exchanges than the individual token will be more valuable. That is often the reason that digital assets have a definite amount for circulation supply.
To incentivize ongoing support for their project, often the team behind a protocol tries to increase the value of each token holder’s current supply by limiting the number of assets that are distributed.
✅ The advantages of burning tokens
So apart from being able to correct an error or removing tokens from circulation, what are the advantages of burning tokens? And more importantly, can you as a token holder really profit from burning tokens?
First, token burning can help to stabilize an asset’s value and curb potential price inflation. The stability that it gives investors is a greater incentive to hold the assets and keep prices even more favorable. Additionally, it keeps the network uptime and bandwidth healthy. Furthermore, token burns also give a sense of confidence and reliability. Which can be the main reason for burning at the beginning stages of a project’s assets. Networks also burn their unsold assets after the ICO to assure greater transparency for investors. What this means for our community members is that all of you will officially own more of the Pawthereum project as a percentage starting October 23rd.
Thank you all for being a part of the Pawthereum community.
Remember to stay #pawsitive
The Pawthereum Core Team