Glossary Term
Token Burn
Token burn refers to the process of permanently removing tokens from circulation by sending them to an unspendable address, effectively reducing the total supply and impacting the tokenomics and scarcity within ecosystems like Solana.
Beginner
General
Crypto Terminology
Token Burn: what is it?
Examples
- 1
A meme coin protocol burns 10% of its transaction fees to boost scarcity.
- 2
DAO governance vote results in periodic token burns from unclaimed rewards.
- 3
An NFT collection burns unsold tokens to increase exclusivity and rarity.
Common Use Cases
Deflationary supply strategies in fungible token projects.
Reducing or balancing supply after IDOs, airdrops, or liquidity events.
NFT “burn to mint” events, where users redeem or upgrade assets by burning tokens.
Project resets, community engagement, and gamified DeFi mechanisms.
Pro Tips
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Always use official token/project interfaces or verified burn addresses for security.
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A burn does not guarantee price increases—market demand is still key.
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Audit token supplies and check public block explorers to monitor real burn events.