TON Community’s Bold Move: 50% Burn on All Transaction Fees to Fuel Supply Reduction

- Advertisement -

• The TON Community proposes a deflationary mechanism to burn 50% of all Toncoin transaction fees, leading to a decrease in the circulating supply.
• The coin burn will not affect the amount of newly issued coins; validators will still retain 50% of the transaction fees.

The Open Network (TON), with its native cryptocurrency, Toncoin, has initiated a significant proposal by its community to implement a real-time burn mechanism. Toncoin, having debuted with an initial supply of 5 billion, would engage in a deflationary process that would burn 50% of all transaction fees, including those related to storage, thereby reducing the currency’s circulating supply.

🚨Attention, #TON holders!

The TON Community proposes a 50% burn on of all transaction fees, including transaction and storage fees, decreasing the circulating supply.

Make your voice heard; cast your vote!➡️https://t.co/OyvOEyfG5U

More info⏬https://t.co/oZzxhvf99A

— TON 💎 (@ton_blockchain) June 5, 2023

This innovative initiative is poised to be a critical milestone for the TON ecosystem’s progression. It aligns the interests of all users and validators, striking a balance between network growth and reward distribution.

TON validators, who currently benefit from two revenue streams, namely transaction fees from users and newly minted coins for each processed block, will witness a shift in their earnings. Despite the proposed deflationary mechanism, the validators will still keep half of the transaction fees. Importantly, this mechanism will not influence the number of new coins issued per block, thereby ensuring continued incentivization for validators.

Toncoin projects have previously dabbled with a “black hole” mechanism, where Toncoins were sent to a specific wallet with a burn function. These coins became inaccessible, but the process was manual and voluntary. This new proposal, however, seeks to automate the burn process and integrate it seamlessly into every transaction.

A coin burn, in cryptocurrency terminology, signifies the elimination of a portion of a token supply, reducing its availability. The tokens are transferred to an inactive wallet, effectively rendering them unspendable. The TON Community is championing a real-time burn mechanism, which will remove a fixed percentage of user fees with each transaction.

We estimate that the initial daily burn would be around 350-400 TON, half of the daily fees of 700-800 TON. The amount burnt will rise as the TON ecosystem expands and the number of daily transactions grows, leading to a noticeable reduction in the total supply.

From the perspective of TON holders and users, the real-time burn will not directly impact their holdings. However, the long-term effects of a decreased supply should favor TON holders, although this will heavily depend on Toncoin’s use cases and market demand.

The proposal’s implementation hinges on the consensus of the majority of TON validators, aligning with the ethos of decentralization. Once the validators vote in favor of the proposal, the deflationary mechanism will come into effect automatically. The burn will occur when the Elector sends only half of the transaction fees to the validators and the remaining half to a black hole address.

The proposed burn ratio stands at 50% of the validators’ commission.

For anyone interested in the precise details of the proposed implementation, the TON Community encourages a review of the whitepaper or a deeper dive into the source code.

Best Crypto Exchange for Everyone:

• Invest in Toncoin and 70+ cryptocurrencies and 3,000 other assets.
• 0% commission on stocks – buy in bulk or just a fraction from as little as $10.
• Copy top-performing traders in real time, automatically.
• Regulated by financial authorities including FAC and FINRA.

2.8 Million Users

Get Started