Unlike a number of other cryptocurrency projects, burning ADA tokens to create scarcity is impossible, as that would be ‘theft’ of someone else’s property, said Cardano founder Charles Hoskinson.
The astonishing power of ignorance is revealed when people cannot grasp that there is no magic reserve of Ada floating out there. All Ada is in the hands of owners, actual people, to burn it would require it be taken from them and destroyed https://t.co/kGzwFyg3nS
— Charles Hoskinson (@IOHK_Charles) August 31, 2022
He replied to a user who reproached him for ignorance. A commenter going by PerAsperaVinco argued that destroying part of the ownership increases the value of what remains.
In the discussion, Hoskinson explained that some other projects have a team-controlled reserve of tokens.
“There are usually a few large premines that the founders control and destroy to manipulate the price during periods of lower liquidity. ADA does not have this,” he wrote.
Usually there is some large premine that the founders control and destroy to manipulate the price during periods of lower liquidity. Ada does not have this
— Charles Hoskinson (@IOHK_Charles) August 31, 2022
According to Hoskinson, all ADA tokens belong to their holders and to the operators of staking pools. They receive rewards in the coin, and taking ADA away from them to burn would be nothing other than theft of property, the Cardano founder stressed.
In the Ethereum network, the mechanism for burning coins as a portion of transaction fees was activated in August 2021 during the London hard fork.
As of writing, the total number of burned tokens превысило 2.6 million ETH. According to forecasts, after the The Merge and the transition to the Proof-of-Stake algorithm, the network will become deflationary.
One commenter reminded that, technically, Ethereum’s issuance is not capped. ADA, by contrast with Bitcoin, has a cap on the coin’s circulating supply, he noted.
Also Eth, for example, doesn’t have a total supply and you could technically «print» Eth forever, so a burning mechanism kind of makes sense there. ADA has a total supply like btc, a very different animal.
— Lnnrt0 (@lnnrt0) August 31, 2022
Cardano outranked Bitcoin in the global brands ranking, taking 26th place. Bitcoin, the digital gold, was 30th.
Read ForkLog’s bitcoin news in our Telegram — crypto news, prices and analysis.