Binance crypto exchange recently conducted its 15th token burn, burning around 760 million Terra Luna Classic (LUNC) tokens. This move has raised questions about the potential effects on the token’s price, along with its relationship to the stablecoin USTC.
Binance exchange has now burned around 40 billion LUNC tokens, with this latest burn being one of many in recent times.
The exchange has been systematically reducing the supply of LUNC tokens by burning them. This process has been going on since September 30, 2023, when the exchange began burning a significant number of tokens, most of which come from trading fees.
Note that during the previous month, Binance burned over 1 billion tokens, signifying a substantial level of activity.
However, the recent burn shows a decrease in the number of tokens destroyed. This could be attributed to lower trading activity, which in turn leads to fewer tokens collected by the exchange for burning.
The LUNC community has been actively involved in burning its LUNC tokens, having torched over 76 billion tokens since 2022.
While some may argue that Binance’s most recent burn of less than 1 billion tokens is relatively modest, others appreciate the continued effort to reduce the token’s supply. This process could potentially lead to increased value for LUNC tokens, although the exact impact remains to be seen.
The burning of LUNC tokens has coincided with a decrease in their price, which is a point of concern for token holders.
Additionally, this development has raised questions about the potential impact on the stablecoin USTC, which is closely linked to Terra Luna Classic.