What Is "Fee Burning" and How Does It Affect the Supply of a Cryptocurrency? ⎊ Path

What Is “Fee Burning” and How Does It Affect the Supply of a Cryptocurrency?

Fee burning is a mechanism where a portion or all of the transaction fees are permanently removed from the circulating supply instead of being paid to miners or validators. This action reduces the total supply of the cryptocurrency over time.

If the amount of fees burned exceeds the amount of new coins issued (e.g. through staking rewards), the asset becomes deflationary.

What Is the Difference between a Fixed-Supply and a Deflationary Token Model?

What Is a Token Burn Mechanism and How Does It Affect Token Supply?

What Is the Impact of a Deflationary Burn Mechanism on Token Value?

What Is the Difference between ‘Circulating Supply’ and ‘Total Supply’?

How Can a Protocol Use Deflationary Mechanisms (Like Token Burns) to Counteract Inflation?

What Is the Primary Function of ‘Burning’ Transaction Fees in a PoS System?

How Does Token Burning Affect the Circulating Supply?

How Does Slashing Impact the Supply of the Cryptocurrency?

Glossar