The EOS Block producers arrived at a majority decision back on July 31, 2018, which proposed the burning of 34 million EOS tokens. tokens which are idly stabled within the platforms savings account.
EOS decided to remove over 34 million EOS worth $167 million from the circulation supply permanently. This massive burn is an attempt to try to lower the inflation rate on the blockchain from 5 to 1 percent.
15 or more of EOS’s 21 block producers voted on July 31, 2018, to burn 34 million idle EOS tokens from the blockchain’s savings account.
The savings account was established in January of 2018 when EOS was launched. But the account has been inactive for eight months, just accumulating funds and not distributing any. Nearly 3.6 million EOS ($17 million) is issued and deposited in the eosio.savings account on a monthly basis. And the amount is only growing due to inflation.
The EOS blockchain has an inflation rate of 5 percent per year which is distributed like so: 4 percent of this inflation is deposited in the eosio.savings account while 1 percent goes to the block producers.
On the 22nd of April 2019, the EOS block producer, EOS Nation, issued a proposal to burn over 34 million EOS tokens. The proposal sought to remove the 4 percent inflation and keep the 1 percent inflation for block producers. It received much support from the community and block producers. The voting process will end at the end of May.
This large quantity of accumulated tokens has now become excessive and if we continue to allow it to keep growing, it will eventually become an attack vector for the network
Do you think the value of EOS will now increase?
Please note, that is not a bit of financial advice, nor the WhaleToBe team’s view.