Plain English
A token burn sends tokens to an unreachable address (no private key exists), permanently removing them from the supply. The goal: reduce circulating supply to make remaining tokens scarcer. BNB, ETH (via EIP-1559), and many protocols burn a portion of their fee revenue.
How it actually works
Burns are verifiable on-chain — anyone can audit the burn address and confirm the tokens are unrecoverable. Mechanisms vary: (1) Fee burns automatically destroy a percentage of every transaction (ETH burns base fee per EIP-1559); (2) Buyback-and-burns use protocol revenue to buy tokens on the open market and burn them; (3) Scheduled burns happen quarterly or annually.
What it means for you
A burn does not automatically raise price — demand has to be at least constant. If usage is falling faster than supply is shrinking, the price goes down regardless. Evaluate burns against real fundamentals, not press releases. The clean version is fee-driven burns tied to actual usage (ETH after EIP-1559 is the canonical example).
Will this information be valuable to you?
Already a member? Send this term to your coach inside the community and tell them exactly what you need help with — we will build a plan around it.
New here? Join the membership, become a student, or sit in on the community. Your starting point is one short call.
Educational content only. Not investment, tax, or legal advice.