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In a new development, the prominent player in gaming and metaverse, Merit Circle, is moving to sustain its value, The DAO voted to burn all MC tokens left in its Community Incentives wallet. This process serves to cut down the project’s total token supply.
As attention in the metaverse kept soaring, some new projects emerged to support activities in the virtual world. Merit Circle crypto aims to maximize value in metaverse activities like games. Crypto centres on crypto assets, virtual investments, and gaming.
Before now, the DAO maintained a monthly burning mechanism for the MC tokens allocated in the wallet. However, it currently has a massive agreement that will destroy the remaining tokens.
Merit Circle Agreed To Burn MC Tokens
The Merit Circle raised a proposal to burn 200 million MC tokens in its Community Incentives wallet. The tokens are worth about $147 million. The burning proposal received a significant number of positive votes. The detail revealed that only 3 out of 232 votes were against the burning motion.
The Community Incentives wallet received 30% of the 1 billion total MC token supply after its creation. The wallet is meant to be the source of tokens for community rewards. However, the tokens have remained dormant without serving any utility purpose from the time of the wallet’s creation.
Hence, the project devised a monthly burning process for the MC tokens in the wallet according to the proposal MIP-7. Over the past nine months, the DAO has maintained a monthly burning of 6,125,000 MC tokens from the wallet. But about 200 million MC tokens are still left in the wallet 8.
The Merit Circle DAO noted that the dormant tokens bloat the overall token supply. For one, they are counted as part of the crypto’s total token supply. Also, they contribute to the diluted valuation of the project and are counted during calculations for future token unlocks.
Impact Of MC Tokens Burn
Once Merit Circle burns the 200 million MC tokens, it will reduce the total token supply of the crypto project. Also, the process will make the fully diluted valuation align with the circulating market cap of the project.
Also, through the massive token destruction, outsiders will have more confidence in the project and its upcoming token unlocks. Furthermore, they will believe that the tokens will emerge according to the project’s roadmap.
During the crypto market’s bullish trend, the Merit Circle crypto joined the train of massive gainers. At the time of writing, the price of MC is hovering around $0.762, indicating an increasing momentum in 24 hours.
Featured image from Pixabay, Chart: TradingView.com
