How often are Prom (PROM) coins destroyed?

PROM coin destruction, conducted during quarterly liquidity injections, aims to reduce inflation and increase token value by permanently removing a predetermined percentage of coins from circulation.

Dec 19, 2024 at 08:59 am

Key Points

PROM coin destruction occurs during quarterly liquidity injections.
The amount of PROM coins destroyed varies based on the total PROM coin supply.
PROM coin destruction mechanisms aim to reduce inflation and increase token value.

Steps Involved in PROM Coin Destruction

Determination of PROM Coin Supply: The total supply of PROM coins in circulation is ascertained.
Calculation of Destruction Amount: Based on the total PROM coin supply, a specific percentage of coins is designated for destruction.
Transfer to Burn Address: The predetermined number of PROM coins is transferred to a designated "burn address," effectively removing them from circulation.
Transaction Verification: The burn transaction is broadcast across the blockchain network for verification.
Reduction in Token Supply: Once verified, the burned PROM coins are permanently removed from the circulating supply, reducing the overall availability.

Benefits of PROM Coin Destruction

Reduced Inflation: By removing PROM coins from circulation, inflation is effectively reduced, maintaining the token's value over time.
Increased Token Value: The reduction in the circulating supply relative to demand increases the value of remaining PROM coins.
Enhanced Scarcity: The periodic destruction of PROM coins creates artificial scarcity, making the token more sought-after and valuable.

FAQs

Q: How often does PROM coin destruction occur?
A: PROM coin destruction occurs during quarterly liquidity injections.

Q: What percentage of PROM coins are destroyed?
A: The percentage of PROM coins destroyed during each liquidity injection varies based on the total PROM coin supply.

Q: Why is PROM coin destruction necessary?
A: PROM coin destruction aims to reduce inflation, increase token value, and enhance scarcity, ultimately benefiting token holders and the overall ecosystem.

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