How much Terra Classic (LUNC) Binance alone can burn in a year? Let’s find out.
On Monday, the world’s largest exchange by 24 hours trading volume, Binance, announced that it would be burning all trading fees obtained from LUNC trading activities. The move came in response to pressure from the Terra Classic community to implement the 1.2% tax burn to off-chain activity.
Notably, the first burn should involve fees collected over ten days from September 21 to October 2. As disclosed by the exchange, data on the amount of LUNC burned will be released every Monday following the period. In this instance, the first data on burns from trading fees will be available on October 3.
It bears mentioning that The Crypto Basic expects this figure to be at least a little above 10 billion LUNC, using a modest average daily trading volume of about $400 million over the last ten days with the 0.1% trading fee. Notably, there were days within the period when LUNC trading volume peaked above $1 billion.
However, the volume in the last 24 hours is about $315 million. Consequently, the exchange would burn at least 465 billion LUNC yearly using the figures above.
In addition, @SkoobyDol, a Twitter account dedicated to sharing LUNC information, reveals that Binance deposits about 17 million LUNC every 5 minutes from its deposit wallet to its main wallet, an on-chain transaction, subject to the 1.2% tax. Notably, this will burn about 58.75 million LUNC daily and about 21 billion LUNC yearly.
Every 5 minutes, 17,000,000 LUNC is on-chain transfered from the Binance Deposit Wallet to the main wallet, resulting in 1.2% tax burn. pic.twitter.com/mMqu8CL4PX
— Knowledge (@SkoobyDol) September 29, 2022
Combining the burns from trading fees and the exchange’s internal movement of funds, Binance will burn at least 486 billion LUNC yearly. This calculation does not include burns from customer deposits and withdrawals subject to the 1.2% tax, which will take terra classic Burns near or above 500B.
TerRarity.io data shows that the tax burn since implementation has burned about 2.89 billion LUNC. Meanwhile, LUNC Burner shows that about 73 million LUNC have already been burned today. The total supply currently remains at about 6.9 trillion LUNC. Using these modest metrics, it will take Binance alone about 15 years to bring the LUNC supply down to the target of 10 billion LUNC.