The real specificity of the cryptocurrency sector is to be based on the principle of tokenomics, specific to each project. That is, the internal strategy of release, distribution and/or destruction included in its economic model. And, at the peak of the overall growth recorded last year, real commonality and speculative enthusiasm for the “burn” principle. This is the programmed destruction of cryptocurrency units in order to reduce the available quantity (supply). But it is clear that this trend seems doomed for some in the dead of bear market winter.
When it comes to burning cryptocurrencies, there is no doubt that BNB is far ahead of this pyromaniac logic. With quarterly destruction of ever-increasing amounts over time. But since the end of last year, the procedure has been completely replaced by the principle of efficient auto-burning. All “in order to provide more transparency and predictability to the community.” But also more measured destruction in direct relation to its efficient use on the BNB chain.
Since this is a proven fact, the cryptocurrency speculative fire has engulfed this digital economy during the latest bull market. With formulas as varied as the quantities were outrageous. It’s some kind of weird competition to see who has the most smoke explosions. And against the background of this burned-out cryptostrategy, there is a palpable unrest in the ranks of investors. The latter buy up the remaining units before their prices skyrocket due to the triggered rarity. But that was before…
Phantom – Community Pulls Out Fire Extinguishers
The cryptocurrency market has a feature that is largely related to its youth and that it is part of the cycles. With Bitcoin as the undisputed master of ceremonies. With the altcoin market often trying to resist its sentiment, nothing more than predictable is predictable. And when the upsurge comes, excitement sweeps through this ecosystem at the head of unreal digital states. To the point where there are many fires popping up all over the place to further exacerbate this trend. But all this artificially created heat did not stop the bear market from coming…
Hot air balloon strategy whose flames start the ascent. The latter has adopted, among other things, the Fantom blockchain (FTM) in the map of its transaction fees calculated using its FTM cryptocurrency. Up to 30% of them are destroyed with each operation registered in its network. All this is according to the principle of scarcity as a mechanical driving force of price increases. Very interesting logic when the FTM price was well over $2 per unit. But it’s slightly less digestible when it’s been below $0.50 for several weeks. Likely reason for the recent community decision to move fire extinguishers.
Fantom – Less burns, more jumps
Indeed, a recent proposal has just been submitted to a community vote on the Fantom Network. This is approximately 10% below the current transaction fee destruction rate (30%). That is, a reduction by 1/3 of this amount, which has so far been reduced to nothing. All this with the aim of placing these digital funds in the FTM in a public vault (vault) called “Ecosystem Support Vault”. And, as the name suggests, the last one will be dedicated to “supporting the ecosystem.” All of this is governed by Special Commission Contract (SFC) 16, “controlled by validators and participants on the basis of the principle of management and proposals.”
“As part of Fantom’s ongoing evolution towards decentralization, this proposal empowers the Fantom community of validators and contributors through an on-chain ecosystem support repository. This repository will provide an alternative path through community-based funding decisions for projects, ideas, and creations on the Opera network.”
The vote was decided before the deadline because over 99.75% of all votes cast had already voted for the plan. And that was enough to get the 55% community approval to get the quorum needed to validate it effectively. So this is acquired, the Fantom network will now only wipe out 20% transaction fees. It remains to be seen how much this may represent in the long run and during this ice age in the cryptocurrency market.
And in the current conditions, this should not bother anyone. Because the trend is clearly more built than speculation. And once this community safe is created, Fantom network projects will be able to apply for funding. This is done in the same way as the proposals presented on the Fantom Management Portal. And a community vote to determine the lucky ones. Let’s hope the whales don’t use this to get rich by stealing community votes. Role model…