The $CRWNY token burn was finalized on the 21st of April. On the $CRWNY token’s 1-year anniversary (we launched on April 21st, 2021) we concluded the last part of our migration to Solana. In this article, we will provide you with some context on what a token burn is, what happened during the $CRWNY token burn and what our new total supply is.
What is a token burn?
The best real-world comparison to a token burn would be removing assets from circulation. This process has been around for quite some time and is what central banks would use to adjust the currency’s purchasing power. In the crypto industry, this process is called a token burn. Once the party governing the token decides to ‘burn tokens’, they can use various mechanisms to render the ‘burnt tokens’ useless. These mechanisms include: sending the tokens to a burn address, calling the ‘burn’ function on the token contract/program, or, in our case, migrating the token and only creating the tokens that are not burned. The result will always be a reduction in the total amount of usable tokens or in other words: a lower total supply, which in turn means an increase in scarcity.
What does this mean
Reducing the number of tokens (or assets) in circulation is normally done with the intention to increase the value. After all, it makes sense that something that is suddenly more scarce (more difficult to get) will cost a bit more. On the stock markets, we sometimes see publicly traded companies buying back their stock to reduce the number of shares available on the market, therefore increasing the value of the shares. Even though these actions are intended to increase their value as well as the company’s financial performance, it doesn’t always work like that. Sometimes it can even have the opposite effect.
Changing the number of shares can also be seen as a control tool. Companies that want to prevent a hostile takeover could change the total number of shares for the sole reason of keeping the ‘hostile buyer’ from gaining the majority of shares and thus ownership of the company. It is important to mention though that there’s no rule that burning tokens increases the value of the token itself. Although this act can positively influence value, investor and user sentiment usually are the stronger forces in driving prices.
Why burn tokens?
The reason for Crowny to burn tokens is coming from a practical perspective. We wanted to fully migrate our token from Ethereum to Solana which meant that we had to completely shut down the Ethereum side. All $CRWNY tokens that people forgot to migrate (twice, even after we reopened the bridge) have not been created on the Solana chain and can therefore be seen as burned. This naturally means that $CRWNY will have a lower total supply on Solana than it had on Ethereum!
Amount of CRWNY tokens burned and the new total supply!
On the $CRWNY token’s 1-year anniversary (we launched on April 21st, 2021) we finally shared that 86.9M $CRWNY were burned, which is over 9% of our total supply!
So what does the new data look like?
New total supply: 813.097.988,242056 CRWNY
Burned amount: 86.902.011,757944 CRWNY*
New circulating supply**: 468.733.166,868832 CRWNY
More information about our tokens and investors will follow shortly!
* (9,66% of the original total supply of 900.000.000 CRWNY)
** According to the Coingecko & Coinmarketcap standards
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