Binance Smart Chain to Introduce Fee-Burning Mechanism

Please fol­low and like us:
Pin Share


article image
Arman Shirinyan

First con­trib­u­tors are already not hap­py with pos­si­ble upcom­ing changes

The BEP-95 update pro­pos­al has been intro­duced on pub­lic Binance Chain Github, which will intro­duce a real-time fee-burn­ing mech­a­nism just like the one that is being uti­lized now on the Ethereum chain. The main goal of the new mech­a­nism inside the chain is to make BNB more valu­able and speed up the burn­ing process.

Two main goals of the mech­a­nism are the speed­ing up of the burn­ing process of BNB and fur­ther decen­tral­iza­tion of BSC. The new update includes two mech­a­nisms that will impact the net­work: the burn­ing of the fixed fee that is cur­rent­ly being dis­trib­uted to val­ida­tors and a man­age­able burn ratio.

With the intro­duc­tion of the burn­ing mech­a­nism for BSC, the process of the BNB burn will sig­nif­i­cant­ly increase, which will pos­i­tive­ly impact the intrin­sic val­ue of the coin. Pre­vi­ous­ly, due to a defla­tion­ary effect, Ethereum’s price increased sig­nif­i­cant­ly in addi­tion to an over­all pos­i­tive mar­ket structure.

BNB hold­ers will be the ones to decide the redis­tri­b­u­tion of gas rewards on the net­work. The con­trib­u­tor expects val­ida­tors and del­e­ga­tor rewards to decrease in BNB. But since the cir­cu­lat­ing sup­ply might decrease sig­nif­i­cant­ly, the con­trib­u­tor expects to see a rise in USD val­ue after the update.

Since there are no min­ing rewards inside the BSC net­work like those on the Bit­coin and Ethereum chains, the gas fee is being redis­trib­uted among val­ida­tors. On the BSC net­work, the gas fee is col­lect­ed from each val­i­dat­ed block on the net­work and then dis­trib­uted among two smart contracts.

If the net­work agrees to imple­ment the update, the gov­ern­able “burn­Ra­tio” para­me­ter will be intro­duced to the net­work. At the end of each block, the val­ida­tor will be able to invoke the deposit func­tion, which will then ini­ti­ate the burn­ing mech­a­nism. The burn of the coins will be achieved by trans­fer­ring fees to the spec­i­fied burn address.

Source link

Please fol­low and like us:
Pin Share

Leave a Reply

Your email address will not be published. Required fields are marked *