The developers behind Floki Inu ($FLOKI), the Shiba Inu dog breed-themed cryptocurrency project, have proposed an ambitious proposal to burn nearly $55 million of its FLOKI tokens and reduce a transaction tax. This move aims to position Floki as a serious decentralized finance (DeFi) contender and address security risks associated with cross-chain bridges.
The idea of creating this cryptocurrency was born on 25 June 2021 after Dogecoin ($DOGE) advocate Elon Musk tweeted that the name of his Shiba Inu dog would be “Floki”.
FLOKI is the utility token of the Floki ecosystem, which “offers a 3D NFT Metaverse, DeFi utilities, a crypto education platform, NFTs, a merchandise store, and more.”
According to a report by CoinDesk, the proposal, which was put to the vote among FLOKI holders, argues that burning tokens is a way to reduce supply, which subsequently adds value to each token so long as demand remains constant. In addition, the Floki team hopes that by taking this step, they can demonstrate a strong focus on utility and fundamentals, which will help the project stand out in the crowded DeFi market.
In a statement to CoinDesk, a member of the Floki core team said, “Floki’s latest DAO vote makes it clear that Floki is more than just a memecoin. We’ve already released our FlokiFi Locker protocol on the mainnet and the first major testnet release of our metaverse game Valhalla in a bear market.”
The proposal also highlighted the security risks associated with cross-chain bridges, which have been the subject of much debate in the crypto community. Last year, over $2 billion was lost or stolen from these types of bridges, as CoinDesk reported. The Floki team argued that an exploit on their main cross-chain bridge would have a catastrophic impact on the project since it currently holds 55.7% of what FLOKI’s total circulating supply should be.
If the proposal is passed, around 4.97 trillion FLOKI tokens would be burnt, and the 3% buy and sell tax FLOKI transaction tax would be reduced to 0.3%. Furthermore, the main cross-chain bridge would be permanently disabled.
According to the governance forum, as of 12:00 p.m. UTC on 28 January 2023, 99.97% of all voters supported the proposal.
Data from TradingView shows that currently (as of 12:17 p.m. UTC on 28 January 2023) $FLOKI is trading around $0.0000163456, up 23.3% in the past 24-hour period. Even more impressively, $FLOKI is up 101.5% in the year-to-date (YTD) period.