On October 9, 2024, at 1pm UTC, a $4 million token burn of DOGS and not will take place, live-streamed on X (formerly Twitter). The burn was voted on by the community, demonstrating impressive transparency from the developers. Instead of holding back unclaimed tokens, they chose to engage the community and we decided to burn them.
But is burning billions of tokens the right move? Let's analyze.
Advantages of the burn 🔥
1. Lower Supply, Higher Demand – Burning reduces the supply of tokens, which can increase the price over time.
2. Community Involvement – This decision is made by the community, to build trust in the project.
3. Transparency – Live streaming of the event is a victory for openness in the crypto world.
Risk 🤔
1. No Price Increase Guaranteed – While fewer tokens can lead to price increases, not every project benefits from burning. Some, like Terra Luna, saw a spike, but others saw no results.
2. DOGS and NOT are new projects – These projects are still young. Burning may not have the expected impact on price and may lead to disappointment.
Ethical concerns 🚨
The paper also raises a deeper issue: what if instead of burning, we donated the tokens to charity? But that raises ethical questions. If these unclaimed tokens come from questionable sources, donating them could damage the charity’s reputation.
