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SBF
@SBF_FTX
2) The amount of BNB burned each quarter is: (1000 * number of BSC blocks) / (BNB price + 1000) There are about 2.5m BSC blocks per quarter, and this doesn't really depend on anything, so the formula is really: # BNB tokens = 2.5b / (price + 1000) What does that mean?
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SBF
@SBF_FTX
3) Well, this is quarterly, so annually it's: 10b / (price + 1000) There are about 170m BNB tokens. Also, the burning stops when there are 100m tokens left.
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SBF
@SBF_FTX
4) So, in the limit where BNB price is small, 10m tokens are burned each year for the next 7 years, and then the burning stops. (Note it isn't clear there's *buying* -- the burn may come from treasury/etc.) Which doesn't really have much to do with Binance, or BSC.
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SBF
@SBF_FTX
Replying to
@SBF_FTX
6) And the thing that determines which of these limits it's closer to is... the price of BNB. If you ignored the 100m cap, then BNB would start burning 10m tokens/year, and ultimately--if the token supply starting running out or price went up otherwise--end up burning $10b/year.
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SBF
@SBF_FTX
7) At that limit, I guess BNB would be worth $200b or something. At the lower limit, it would be worth... well, it's unclear, because you can't burn 10m tokens every year forever, or you'll run out of tokens. If you stop burning at 100m, tWhen it just reduces total supply.
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SBF
@SBF_FTX
8) So if BNB's price goes up, then it's worth $200b except for the 100m cap; if BNB's price goes down, then it reduces to 100m supply over ~7-10 years. Which is... interesting? It's a cool mechanism. But it's not clear it's related at all to Binance.
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