Crypto exchange Binance’s management team has announced that Binance Coin’s (BNB) 7th burn, for “the period between January 1st and March 31st, 2019,” has been completed.
The exchange operator has reportedly “burned 829,888 BNB,” an amount valued at about $15.6 million. As explained in an official blog post, published on April 16th, 2019, by Binance’s management, “the [number] of BNB [tokens] burned this quarter is about half” as many that were “burned last quarter.”
As BNB Price Increases, “Burn Rate Will Become Slower”
The post further noted that “considering BNB has more than tripled in value during these past 3 months, the USD equivalent is significantly higher than last quarter.” Binance’s blog also mentioned that “with the rise in the price of BNB, the burning rate will become slower, assuming all other [factors remain] constant.”
According to Binance, its token burn process was clearly specified in its whitepaper before BNB was launched. Moreover, the digital asset exchange firm claims it had anticipated the “dynamic effect” of the BNB token prior to its release.
Binance’s team also pointed out that BNB “began to rise before” the Bitcoin (BTC) price even began to recover. What this means is that “fewer BNB were spent on trading fees by our users, resulting in lower revenue in BNB,” the exchange’s blog explained. It added that despite lower net returns in BNB, the company’s “revenue denominated in USD” increased significantly during the same time period.
Notably, Binance’s management also believes that “with the recent rise in BTC price,” the exchange’s “revenues in USD terms” could also “make a turnaround.”
“BNB Price Rose Before BTC This Time”
Commenting further on the Bitcoin price, Binance’s team noted that the world’s most dominant cryptocurrency “began rising [in value] first” and this was followed by an increase in the prices of other cryptocurrencies. However, Binance’s management revealed that there was a noticeable shift in this pattern as “this time, the BNB price rose before BTC.”
Acknowledging that they don’t really know why the price of Binance Coin surged before Bitcoin rallied, Changpeng Zhao, the CEO of Binance, wrote:
Our mantra has been quite simple, to keep our heads down and focus on building. We kept building all throughout 2018, and 2019. I think that’s really it. We build products that people use and we never stop trying to improve ourselves and our products. Price will eventually catch up to the value you create.