By Tom Blitzer
Key Insights:
- Huobi’s Q2 token burn surges by 235%, demonstrating a commitment to bolstering HT value.
- The transition to quarterly burns reflects Huobi’s strategic response to HT community feedback.
- Huobi’s diverse revenue streams enable significant HT burn allocation, driving value preservation.
Renowned cryptocurrency exchange, Huobi, has delivered a striking performance. In Q2 2023, Huobi burned 1,950,555 of its Huobi Tokens (HT). This quantity dramatically increased from the preceding quarter, showing a breathtaking 235% escalation. Moreover, this move signifies Huobi’s commitment to bolstering the HT value by diminishing its circulating supply.
The sheer magnitude of HT burned hints at an intriguing picture of Huobi’s financial standing. An impressive 20% of the exchange’s revenue gets allocated for the token-burning mechanism. Consequently, the vast quantity of HT burned, priced at $2.77 each, provides an insight into Huobi’s impressive Q2 earnings. Hence, the revenue crossed a whopping $26 million, significantly higher than the $16.55 million generated in Q1.
Huobi’s Transition and Its Implications
Huobi transitioned its burning practices in December last year. Besides monthly burns, it has now incorporated quarterly burns. This change was in response to feedback from the HT community. The last burning data was also shared in April, revealing the burn of 827,226 HT. Hence, the latest burn signifies a leap, as Huobi incinerated over 1.9 million tokens this quarter.
This consistent burning practice has led to a cumulative total of 298,940,224 HT burned as of July 15, 2023. This strategic action ensures a steady decrease in the number of circulating HTs, which is currently around 162 million, according to data from CoinMarketCap. Furthermore, Huobi’s circulating deflation rate for Q2 stood at a mere 0.9066%. This demonstrates the exchange’s dedication to value preservation and enhancement.
Huobi’s Comprehensive Revenue Streams
However, it’s essential to understand Huobi’s varied revenue sources. These include spot, futures, and OTC trading fees and interest from margin loans. Besides, withdrawal fees and proceeds from other products and services also contribute. This diverse revenue stream has allowed Huobi to allocate a substantial part of its income for burning HT, hence playing a crucial role in managing the token’s value and supply.
Significantly, Huobi’s latest actions showcase an unwavering commitment to maintaining its token’s value. Besides, the astounding revenue growth also indicates a thriving crypto ecosystem. With its strategic token management and diverse revenue streams, Huobi continues to impress and remains a formidable player in the global crypto arena.