The developers of the Floki (FLOKI) memecoin are proposing to burn 2% of the circulating supply, which amounts to 190 billion FLOKI tokens or over $11 million. This move aims to boost scarcity and bolster network security.
Crypto burning, also known as token burning, involves deliberately and permanently eliminating specific tokens or coins from circulation. This action impacts the token’s perceived value by influencing its supply.
The primary objective behind a crypto burn is to enhance the token’s market value. In practice, this deflationary strategy has led to other beneficial outcomes, including heightened demand and market value, sustained liquidity, and increased investor confidence.
The developer community has decided to burn Floki tokens from the supply stored on the Multichain Bridge. The Multichain Bridge is a platform designed to facilitate the transfer of tokens between different blockchain networks. However, in July 2023, the bridge experienced an exploit, leading to over $130 million loss.
Floki developers had withdrawn tokens from Multichain before its implosion and have since held them in a secure wallet. The decision to burn these tokens arises from concerns about Multichain’s reliability.
Per a statement to CoinDesk, a team member with designation, Developer B stated, “We believe that the only trustless way to guarantee that they NEVER enter into circulation is to burn them.” This move follows a previous token burn event by Floki in January 2023.
Recently, DWF Labs pledged to buy $10 million FLOKI tokens as a commitment to the Floki ecosystem and to position Floki strategically for dominance.
https://twitter.com/DWFLabs/status/1762441279848263747?s=20
The deal involves acquiring FLOKI tokens from the Floki treasury over two years, providing significant financial support to boost Floki’s visibility.
This partnership between Floki and DWF Labs began in May 2023, with an initial investment of $5 million in FLOKI tokens by DWF Labs.
