BNB (BNB) is the core cryptocurrency of the Binance ecosystem. It plays a key role on the BNB Chain and can be used to pay transaction fees, for staking, governance, and various DeFi services. BNB’s supply and burn mechanisms are integral components of its economic model, directly impacting its market value and scarcity.
BNB’s Initial Supply and History
BNB was initially launched in July 2017 through an Initial Coin Offering (ICO) at an initial price of approximately $0.10. At that time, BNB’s total supply was set at 200 million tokens. During the ICO, 100 million BNB tokens were sold.BNB was originally issued as an ERC-20 token on the Ethereum blockchain. However, following the mainnet launch of BNB Chain in April 2019, all BNB tokens were migrated to BNB Chain at a 1:1 ratio.
BNB’s Burn Mechanism
To reduce the total supply of BNB and create a deflationary effect, Binance introduced a burning mechanism. Burning refers to the process of permanently removing a specific number of tokens from circulation, with the aim of increasing the value of the remaining tokens. The goal of BNB burning is to gradually reduce the total supply to 100 million.
BNB primarily employs two burn mechanisms:
- BNB Auto-Burn: This is BNB’s primary burn mechanism, launched in December 2021. It automatically adjusts the amount of BNB burned based on BNB’s price and the number of blocks generated on the BNB Chain each quarter, aiming to provide greater transparency and predictability.When the total supply of BNB falls below 100 million, the Auto-Burn mechanism will cease.
- BEP-95 Burn Mechanism: In addition to auto-burn, the BEP-95 mechanism on the BNB Chain also continuously burns BNB. When BNB is used as gas fees for transactions on the BNB Chain, a portion of those gas fees is burned.
- BNB Pioneer Burn Program: Binance has also launched this program, under which eligible users who have lost tokens can have them counted toward the official burn count and receive compensation in the form of new BNB of equal value.
BNB’s Current Circulating Supply and Total Supply
Due to the ongoing burn mechanism, BNB’s actual circulating supply and total supply are constantly changing. Data as of approximately July 5, 2024, shows:
- Circulating Supply: BNB’s circulating supply is approximately between 134.78M and 134.79M BNB.
- Total Supply: BNB’s total supply is also roughly between 134.78M and 134.79M BNB.
- Max Supply: BNB’s max supply is currently also shown as approximately 134.78M to 134.79M BNB.
These figures reflect the ongoing impact of BNB’s burn mechanism, which has gradually reduced its total supply from the initial 200 million.
Uses of BNB
BNB has a wide range of uses both within and outside the Binance ecosystem, including:
- Paying transaction fees on the BNB Chain.
- Paying fees for spot, leveraged, and futures trading on the Binance exchange and receiving discounts.
- Staking and participating in governance on the BNB Chain.
- Serving as collateral, liquidity, and governance tokens in various DeFi protocols.
- Paying for goods and services via Binance Pay.
- Participate in token sales on Binance’s Launchpool and Launchpad.
