Definition

Burning happens when a cryptocurrency token is intentionally sent to an unusable wallet address to remove it from circulation. This practice often occurs to decrease the supply to raise the price of a cryptocurrency as manipulating the supply and demand dynamics can benefit current holders.

Examples of Usage

• “The co-founder of Ethereum, Vitalik Buterin, has burned 90% of his Shiba Inu tokens.” 

• “The EIP-1559 protocol modified the Ethereum fee market by introducing a burn feature that removes a percentage of the blockchain’s transaction fees from circulation.” 

• “Binance has multiple major burn procedures for its BNB tokens at the moment. A percentage of the gas allowance spent on BSC, for example, is immediately burned. BSC also burns roughly 860 BNB tokens per day. Finally, every quarter, BSC burns a certain number of tokens”. 

Origin of the term “Burning.”

Iain Stewart first introduced the idea of Proof-of-burn in 2012. PoB is a system that enables the irreversible and provable destruction of a cryptocurrency. Coin burning went from an eccentric act to a more accepted protocol procedure after more evidence showed that it could be helpful.

Source: https://eprint.iacr.org/2019/1096.pdf