Binance Coin Burn 2020

Coin burning is the process of permanently removing cryptocurrencies from circulation, reducing the total supply. Today, we will discuss the Binance Coin (BNB) burn function and how it works on the BNB Chain.


When the BNB Coin was still part of the Ethereum network, Binance performed periodic Coin Burn events using a smart contract function known as the burn function. These burning events were scheduled to occur every quarter until 100,000,000 BNB were finally destroyed, which represents 50% of the total BNB ever issued (200,000,000 BNB).

Previously, the quarterly BNB burns were based on the BNB trading volume on the Binance exchange. However, in December 2021, Binance announced that the Quarterly Burn would be replaced by the new BNB Auto-Burn mechanism.

The BNB Auto-Burn mechanism automatically adjusts the amount of BNB to be burned based on the BNB price and the number of blocks generated on the BNB Chain during the quarter. This offers greater transparency and predictability to the BNB community. BNB also has a real-time burning feature introduced with the BEP-95 protocol update. This burns a portion of the gas fees for transactions and smart contract interactions.

How Does a Coin Burn Work?

A token burn event happens in the following order:

  1. A cryptocurrency holder calls the burn function, stating that they want to burn a nominated amount of coins.
  2. The smart contract verifies that the person has the coins in their wallet and that the number of coins stated is valid. The burning mechanism only allows positive numbers.
  3. If the person doesn’t have enough coins or if the stated number is invalid (e.g., 0 or -5), the burn function won’t be executed.
  4. If they do have enough, then the coins will be subtracted from that wallet. The total supply of that coin will then be updated, meaning that the coins were permanently burned.

If you execute the burn function to burn your coins, they will be destroyed forever. It’s impossible to recover coins after they are burned, and thanks to blockchain technology, the proof of burn can be easily verified on a blockchain explorer.

The Current Binance Burn Function

Since the launch of the BNB Chain, the BNB ERC-20 tokens were gradually swapped by BNB BEP-2 coins. This means that the Coin Burn events now take place on the BNB Chain and not on the Ethereum network.

All BNB ERC-20 coin burns were “replicated” on the BNB Chain to ensure that the total supply remains the same. The 11,654,397 BNB ERC-20 tokens that were previously burned on the Ethereum network were also burned on the BNB Chain.

There are two methods to burn BNB. The first is the BNB Auto-Burn, a protocol for quarterly BNB burning events. Some users who can prove they sent BNB to dead wallets can also include their coins in this quarterly burn and have their tokens refunded from the Auto-Burn amount. The second mechanism is a real-time burning mechanism introduced in the BEP-95 protocol update, which involves burning a portion of the BNB spent as gas fees on the BNB Chain.

As of April 2023, Binance has completed 23 BNB coin burn events. In total, 44,833,226.65 BNB coins were burned, reducing the initial supply by approximately 22.37%.

For further details on BNB coin burn events, you can refer to the “BNB Destruction History (Quarterly Coin Burn)” on the Binance website.

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