Cryptocurrency exchange Bitfinex announces a burn initiative for its utility token LEO.
Cryptocurrency exchange Bitfinex announced a LEO burn initiative in a Medium post published on June 14.
Per the announcement, the initiative will see the exchange’s parent company iFinex funnel its gross revenue into purchasing LEO tokens at market prices in what the post refers to as the UNUS SED LEO burn mechanism. This new system will launch alongside the LEO Transparency Dashboard, which will reportedly provide real-time insights into all collected platform fees and LEO token burns. The company explains its reasoning:
“We are doing this to remove the possibility of uncertainty from LEO holders, subsequently allowing our community to track iFinex revenues, as well as LEO token burn quantities, in an open manner.”
At first, the system will only involve revenue from trading fees, but the company promises to expand it to all other revenue streams, including deposit and withdrawal fees, funding fees and other services. The post further notes that the initiative will include entities such as EOSfinex, and that the tokens will be bought “at market rates and on an hourly basis, equal to a minimum of 27% of consolidated revenues of iFinex.”
The burn mechanism is set to stop only when there are no more tokens in circulation. The LEO tokens that are used to pay trading fees on the exchange will also reportedly be burned, and at least 80% of the funds recovered from the Bitfinex hack will also be used to buy and burn them.
As Cointelegraph reported at the time, Bitfinex unveiled its exchange utility token UNUS SED LEO on May 17.
Earlier in May, Bitfinex and the affiliated stablecoin Tether were subject to legal investigation in New York state for misrepresenting their reserves.