In an event performed quarterly, Huobi, which is one of the most widely used cryptocurrency exchanges in the world, has decided to reduce the existing supply of the HB, or Huobi Token, which is the one associated with its decentralized platform.
Huobi is among the oldest crypto exchange platforms in the planet, which makes the news noteworthy. The development was made public by the company itself this week via a statement, in which it detailed that it “burned” (meaning that they removed them from circulation) 14,011,700 tokens from a 310,318,300 market supply.
A 116% Increase in Burning Rate
The removal of the aforementioned coins was performed at a higher rate than it was done in the last quarter, at precisely 116% more. When discussing the reasons behind this, Huobi stated that the primary factor was “improving market conditions” and a marked growth in the sales department.
According to reports swirling around the company, the burning event is performed with the intention of finding stability when it comes to the currency’s price. Similarly, Huobi looks to incentive customers and users to hold HT by curbing inflation out of the equation. Ever since the start of 2018, Huobi has spent roughly 20% of its quarterly profit in acquiring outstanding tokens.
And, since the revenue numbers can fluctuate between quarters depending, among other factors, on the market conditions; the crypto exchange does not always “burn” the same consistent amount of tokens. In this case, the company experienced a good quarter and used that as a foundation to report a 232% quarter to quarter increase in the revenues destined to the burning schedule.
Eight Burning Events since April 15
Since April 15th, the Singapore-based platform has performed as much as eight burning events in which 21,356,800 HT were repurchased, a number that surpassed last quarter by 6,474,800 HT. These re-acquired HT are kept in an Ethereum address named the Huobi Investor Protection Fund.
According to Leon Li, who is the Founder and current CEO of the company, “there are two big trends reflecting the size of this quarter’s buyback. The first is a rapidly strengthening market for digital assets and the other is the increasing popularity of our entire product line.”
More to Come
Speaking of the Huobi product line, the platform referred to the increasing upgrades in membership to Huobi Prime and Huobi FastTrack services, which generate lots of fees, as critical developments for the reported success, as well as the productive spring that Huobi DM had when it comes to trading volume, with $504 billion.
“The rest of 2019 will see even more improvements and innovations coming from Huobi,” according to Li, who stated that there were some crucial updates coming to the Huobi Finance Chain, which is a decentralized finance public blockchain.
The company also informed, in a separate piece of news, that the present burning event “will be the last time HT tokens will be destroyed using the traditional buyback method.” In the future, Huobi will burn tokens directly through the profit generated in the Tiered Fee deduction program.
By Andres Chavez