OKEx’s OKB token has risen little over 90% in the last 30 days, with most of the growth coming shortly after the cryptocurrency exchanges announced it’s burning 70% of the cryptocurrency’s supply.
CryptoCompare data shows that the OKB token has bee slowly rising over the last 30 days, going from about $2.9 in mid-January to $3.9 last week. The cryptocurrency’s price then surged after OKEx’s CSO Alysa Xu announced OKChain’s testnet is now live and that the exchange decided to burn 70% of its total supply.
OKChain Testnet is now live! It has been a long time coming but I am extremely proud to share with everyone our very own decentralized public chain. OKChain will act as a foundation for the entire OKEx ecosystem. https://t.co/SCbt63nML4
— Alysa Xu (OKEx) (@alysa_xu) February 10, 2020
In the announcement Alysa Xu tweeted out, OKEx reveals it decided to burn a total of 700 million unissued OKB tokens, effectively capping the cryptocurrency’s supply at 286 million. While OKEx can issue more tokens using its current ERC-20 smart contract, the exchange revealed it “will not be issuing any” and that it plans on deleting the smart contract’s code once OKB is migrated to OKChain’s mainnet.
The OKChain itself is a decentralized public blockchain that will support decentralized applications and allow users to issue their own cryptocurrencies. One of the first decentralized applications it will support is a decentralized exchange called OKEx DEx.
Some of the features OKEx touts OKChain will have include the ability to develop applications on OKChain and on other blockchains at the same time, improvements to sharding to support large-scale applications, and positional internal competitions. The blockchain uses a delegated proof-of-stake consensus algorithm, with a soon-to-be-issued token called OKT being its native cryptocurrency.
The cryptocurrency exchange’s announcement saw the price of OKB jump from $3.9 to $5.5, with the cryptocurrency rising 0.58% in the last 24-hour period, seemingly showing the rise isn’t over.
OKEx’s OKB may have also been rising as the cryptocurrency exchange uses a portion of its profits to burn tokens every quarter. Taking this into account, it recently announced its BTCUSD options have reached a total trading volume of $175 million in their first month. With the announcement, the exchange said it will launch portfolio margin products to “further improve customers’ capital efficiency.”
Lennix Lai, Financial Markets Director at OKEx, was quoted as saying:
Beyond trading volume that we are looking at, the market has gained an increased supply in this options trading space and created a stronger trading ecosystem. Options trading is often at an advanced level handling and we have seen a nice balance between institutional and retail investors
As CryptoGlobe reported, data from CryptoCompare’s December 2019 Exchange Review showed OKEx was leading in crypto derivatives trading among only four exchanges that made up 96% of the total crypto derivatives trading volume.
Featured image via Pixabay.