What is the burning in CZ's mind?

What is the real burning?

Today, I will analyze with you that the burning in Zhao Changpeng's mind is benign. It has the concept of benign deflation. It has more scarce circulation value.

Now there are many burning concepts in the primary market. Here, I have summarized a few points by participating in some burning projects.

As long as it is the burning of the pot, it is wrong, because Defi finance itself has bubbles. If it is burned from the currency standard pot, it is probably a substitution of concepts.

As long as the pot is automatically destroyed every day, no matter how many percent, it is unreasonable. In other words, the larger the percentage, the larger the bubble. For example, the gold standard does not go in and out. For example, the gold standard 1,000 Ethereum is equivalent to the 10 million tokens in the pool. The circulation of this token is 500 million. Then retail investors have at least 40 million chips. However, the remaining 10 million in the pot will be automatically destroyed by 6% every day, so that the remaining tens of thousands of coins can be destroyed in 300 days at most. Then the problem comes. As long as a large holder of coins comes, the pot will be smashed. This is the biggest disadvantage of pot burning.

Each exchange has an audit team. It is impossible for such a mechanism to be burned on a serious exchange. Because the bubble is too big, many investors can only play fast, so as long as it is the pot burning, it does not conform to the concept of benign deflation of finance itself.

So what is the real burning? This is very simple. That is to do it the other way around, that is, to destroy it every time a transaction is made. In this way, there will be a daily decrease in circulation except for the pot, so that every holder of coins will cherish the chips in their hands. Moreover, the destruction of the pot and the automatic destruction of such transactions actually form an opposite contrast. The destruction of the pot may be very fast in the early stage of the burning, and it will be slower and slower in the later stage, while the destruction of transactions is very slow in the early stage, and it will be larger and larger in the later stage. Therefore, compared with the burning of transactions outside the pool, the burning in CZ's mind is the burning.

So everyone must open their eyes to identify whether the project you are participating in is also unreasonable.

To conscience, to leeks.