The Klaytn Foundation proposed to destroy 5.28 billion tokens, and the price of KLAY rose by 18% in just one hour

The Klaytn Foundation, one of the main developers and code maintainers of the Klaytn blockchain, has submitted a token optimization proposal to its Governance Committee (GC) to help Klaytn grow into a sustainable decentralized network.

The proposal will be voted on from February 22nd to February 28th by the GC, the group of network participants currently overseeing the governance of the Klaytn network.

The proposal includes short-term tokenomic improvements: from burning 73% of the initial reserve supply, up to 5.28 billion KLAY (approximately 48% of the current total KLAY supply), to improving the transparency of deposit disclosure and revising the governance structure of the ecosystem resources .

To date, over 75 million KLAY have been burned through strategic acquisitions and reduced gas fees. There are currently about 3.073 billion KLAY in circulation.

Of the initial 7.48 billion KLAY mining reserve, the fund originally intended to burn 5.28 billion KLAY that had not been used for the past three years and eight months. About 200 million KLAY has been contracted to be paid to GroundX, a subsidiary that develops the Klaytn blockchain, to transparently perform infrastructure development, network operation, and management services.

The remaining 2 billion KLAY will be designated as a “KLAY Value Creation Reserve”, which will only be redirected to use cases and scenarios that help facilitate deflationary KLAY.

This token technology is designed to create lasting value for KLAY tokens.

“The foundation hopes to increase demand for KLAY in a number of ways: first, to increase on-chain interactions, especially within the Klaytn ecosystem, by partnering with large portfolio projects and promoting services within the Klaytn ecosystem. In particular, it hopes to “use and Burning “dApps’ KLAY as their primary tokenomics,” Klaytn said in the proposal.

The fund added that its goal is to increase the utility of KLAY beyond transaction fees by securing essential infrastructure services such as oracles for the ecosystem, as well as investing in projects. The Klaytn ecosystem requires high growth potential, and such investments will return to the ecosystem and use said profits to expand KLAY demand.

At press time, the native token KLAY had rallied nearly 18% in just 1 hour after the announcement, hitting a high of $0.37 before plummeting to current levels.

Source: TradingView

  • Klaytn Foundation Changes Governance and Token Economics Model KLAY – Token Price Up 18% Before Falling
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