What is a crypto coin burn?

Burning crypto is the process that effectively takes those tokens out of circulation, reducing the total supply of that coin and in some cases increasing demand. A crypto coin burn is similar to a stock buyback. That’s when the company that issued the stock buys back a number of shares and reduces the total number of shares on the market.

How is burning crypto done?

We explain how burning crypto is done … and why. “Burning” crypto means permanently removing a number of tokens from circulation. This is typically done by transferring the tokens in question to a burn address, i.e. a wallet from which they cannot ever be retrieved. This is often described as destroying tokens.

What is a wallet address used for burning cryptocurrency?

Wallet addresses used for burning cryptocurrency are called "burner" or "eater" addresses. The act of burning effectively removes tokens from the available supply, which decreases the number in circulation. Cryptocurrency users are assigned an address used to send and receive coins.

How do miners burn their own cryptocurrency?

Depending upon the implementation, miners are allowed to burn the native currency or the currency of an alternate chain, such as Bitcoin. In exchange, they receive a reward in the native currency token of the blockchain. You can send out transactions to the network that will burn your own cryptocurrency coins.