#Token_Burning: The Mechanism Behind Supply Reduction in Crypto Projects
You might have heard of "token burning," a process used by projects to reduce the overall supply of their tokens or coins. But what does "burning" actually mean? Does it involve any literal fire? Not quite!
Token burning essentially refers to sending tokens to a "burn address," an inaccessible address with no ownership. This process effectively removes tokens from circulation. For instance, on Ethereum, BNB, and Base blockchains, one of the commonly used burn addresses is:
0x0000000000000000000000000000000000000000
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Burn Addresses: A Hidden Opportunity for "Degen Plays"?
Burn addresses also hold an interesting potential beyond just reducing supply. In the world of "degen plays," keeping an eye on burn address transactions can actually help identify promising meme coin projects. Some projects send a portion of their tokens to a burn address at launch to generate initial hype.
By monitoring burn address transactions, you might just spot the next high-potential degen project early!
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This approach is worth considering for those looking to find the next big meme coin or high-risk, high-reward play in the crypto space.
