Controlling Supply
Token burning is commonly done by projects that initially minted a large number of tokens but then want to create scarcity. The goal is to maintain or increase the token’s value.
Stabilizing Token Price
A stable price is significant for stablecoins and wrapped tokens. Prices can be stabilized by minting new tokens when demand rises and burning when demand falls.
Strengthening Investor Confidence
Conducting regular token burning is a sign that a project is committed to maintaining or increasing the value of its token. This can boost investor confidence to hold tokens for the long term.
Increasing Publicity
News about token burning is a hot topic in the crypto community, so plans for token burning are often promoted by the project team.
In addition, token burning can serve community engagement purposes. For example, token holders can participate in token burning events.
How Token Burning Works
The token burning process is rather simple.
Initiating Token Burning
The token project team decides to burn a certain amount of tokens. This decision can be made to reduce supply, increase scarcity, or achieve specific project goals. In addition, the team determines the number of tokens to be destroyed.
Sending Tokens to a Burn Address
The tokens to be destroyed are sent to a burn address. Tokens in the burn address cannot be accessed or used again.
Recording on the Blockchain
Just like all other token transactions, burn transactions are recorded on a blockchain that is transparent and verifiable by anyone. This builds trust in the community and confirms that the burn actually occurred, rather than being just a promotion by the development team.
Updating Supply Amount
After the burn is complete, the new supply amount is updated to reflect the reduced number of tokens. This update is automatically performed by the blockchain network.
Verification
The burn address and the tokens stored in it are permanently locked so that they can no longer be accessed or used. This can be verified by blockchain explorers and audit tools.
Real Example of Token Burning: DRX Token
One real example of token burning is DRX Token, an Indonesian utility token project that combines the Web3 ecosystem with real-world sports.
Through the official DRX Token social media channel on 09/12/2025, CEO and founder Kash Topan announced that DRX Token would conduct its first token burning.
The number of tokens to be burned is 5 billion DRX Tokens, equivalent to 10% of the total supply.
This token burning aims to increase the token’s value, thereby directly benefiting the loyal DRX Token community.
FAQ
Where do burned tokens go?
Burned tokens are sent to a crypto wallet address that can no longer be accessed, known as a burn address.
Why is DRX Token performing a token burn?
DRX Token is conducting a token burning to increase the token’s price, as well as to show appreciation to the loyal DRX Token community.
When will DRX Token perform the burning?
DRX Token will conduct its first token burning in the near future. Follow the official DRX Token website and social media channels to stay updated on the latest information regarding token burning.
Does DRX Token plan to do more burns in the future?
Yes. Following the first token burning, which will be conducted in the near future, DRX Token has plans for several more token burning phases to increase the token’s value.
Conclusion
Token burning is a strategy used by crypto projects to control token supply and value. The goal is to maintain or increase the value of tokens by reducing their supply. In addition, token burning a form of appreciation from the team to the community.
One token project that will conduct a burning is DRX Token. Follow DRX Token’s official social media channels so you don't miss the latest news about token burning!
