TON Network May Introduce Burn Mechanism to Destroy 50% of Transaction Fees
The TON Foundation proposed introducing a burn mechanism that would destroy 50% of all transaction fees on the TON network.
This is a similar strategy to Ethereum’s EIP-1559 upgrade, which saw a massive reduction in Ethereum’s network inflation because the burn amounts have been so large. Only this proposed burn will have a much smaller impact on TON’s level of inflation because the network’s staking rewards dwarf transaction fees.
“In the short term, the deflationary impact may seem modest, estimated at roughly 350-400 Toncoin daily, given a daily issuance rate of 71,000 Toncoin,” said Kirill Emelyanenko, a core lead developer at TON Foundation. “However, as the network volume grows, this number has the potential to increase significantly, leading to visible deflation in both the total and circulating supply.”
If the burn mechanism is implemented, when a user makes a transaction on the network, a portion of those tokens would be burned, with the remaining going to the validator as usual. The validator will also continue to receive staking rewards for helping to run the network.
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The TON Foundation proposed that the burn mechanism be set at 50%, but Emelyanenko noted that this would be subject to the decision of the validators and its community.
The proposal will need to get approved by the majority of TON validators to be enacted. It has already been passed to the validators, and discussions are underway.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
