Circle, the issuer of USD Coin (USDC), has recently burned 150 million USDC tokens, equivalent to around $150 million. Whale Alert, a blockchain alert service, described the transaction on Ethereum. Circle switched the USDC to a null address, which caused a buzz in the community since it was impossible to access it.
This significant burning event is part of a broader trend observed over recent months. On Monday, Circle incinerated over $61.3 million worth of USDC tokens. Blockchain records indicate that the null address used by Circle for these burns often receives small-value inbound transfers, with some transactions recorded just minutes before.
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Circle $1.061 Billion USDC Token Burn by May’s End
Minting and burning USDC can also be described using the information found on Circle’s official site. Whenever the business deposits the USD into its Circle Account, Circle sends the equivalent amount of USDC to the business account. This process is known as minting, making the initial circulation of USDC higher than designed. On the other hand, when a business intends to sell a particular amount of USDC for USD, it will transfer USDC to its Circle Mint account and request for USD conversion. This process is called burning, which can be understood as the disposal of USDC.
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The recent $150 million transaction reflects a business entity redeeming significant stablecoins from Circle. Whale Alert tracked large-value USDC redemptions totaling over $371 million this month. By the end of May, Circle had also burned over $1.061 billion in USDC tokens. One of the most notable transactions occurred on March 14, 2023, when Circle destroyed $2.2 billion USDC tokens daily.
Circle recently burned 150 million USDC tokens, a relatively significant transaction within the context of cryptocurrencies. This points to constant action even when there is no large-scale redemption of USDC. Given such priorities and as the blockchain community intensifies the monitoring of these transactions, such massive burns’ rationales are something that causes interest and concern.
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Maxwell Mutuma
Maxwell is a crypto-economic analyst and Blockchain enthusiast, passionate about helping people understand the potential of decentralized technology. I write extensively on topics such as blockchain, cryptocurrency, tokens, and more for many publications. My goal is to spread knowledge about this revolutionary technology and its implications for economic freedom and social good.