Thread by @bsc_daily

OVERVIEW: BEP-95 ‼

Let's dive in BEP-95 - a real-time burning mechanism proposed recently with ambition to have positive impact on the value of BNB.

Check the thread below 👇 and tell us what you think about this proposal 🧐

#BSC @BinanceChain @binance @cz_binance

@BinanceChain @binance @cz_binance 1.1/ 𝐄𝐟𝐟𝐞𝐜𝐭𝐬

Burning BNB through BEP-95 will essentially affect the earnings of validators and delegators as the portion of the gas free was burned instead of going to them. However, this burning mechanism, in the long run, can accelerate the burning of BNB

@BinanceChain @binance @cz_binance 1.2/ which reduces the supply of BNB leading to increased demand and thereby creating a motivation for a higher value of BNB as well as increasing the annual deflation rate ( currently is -2.35%, according to Viewbase). Therefore, the earning of validators and delegators will

@BinanceChain @binance @cz_binance 1.3/ be balanced through the adjustment in burnRatio to BNB prices. Moreover, in the bad scenario, which the proposed burn ratio affects badly to the validators and delegators, they will be able to vote via proposals to change the burnRatio amount through governance mechanism.

@BinanceChain @binance @cz_binance 2.1/ 𝐈𝐧 𝐂𝐨𝐦𝐩𝐚𝐫𝐢𝐬𝐨𝐧 𝐖𝐢𝐭𝐡 𝐄𝐈𝐏 - 𝟏𝟓𝟓𝟗
First impression: it seems like BEP - 95 is following in Ethereum’s footsteps with the real-time burning mechanism. However, the idea is close but not identical to EIP-1559's proposal for Ethereum. In EIP - 1559, the total

@BinanceChain @binance @cz_binance 2.2/ amount of fees burnt has often been less than the new amount of ETH produced every block, therefore, reducing the amount of inflation on Ethereum but not making it deflationary while there is no inflation currently on the BSC network and BEP-95 aims to increase deflation.

@BinanceChain @binance @cz_binance 2.3/ At the time EIP - 1559 was activated, one of the most concerns was also the impact on miners' revenue due to the burning of gas fee. But, according to the daily mining revenue till now, there are no significant effects on the miners’ earnings. Moreover, as the ETH price

@BinanceChain @binance @cz_binance 2.4/ reached a new ATH recently, they are even having more profit. Therefore, the earning of validators may not be the most significant concern in the future if BEP - 95 is accepted.

@BinanceChain @binance @cz_binance 3.1/ 𝐈𝐧𝐚𝐝𝐞𝐪𝐮𝐚𝐜𝐢𝐞𝐬 𝐀𝐛𝐨𝐮𝐭 𝐁𝐄𝐏-𝟗𝟓

𝙉𝙤𝙩 𝙩𝙖𝙠𝙞𝙣𝙜 𝙞𝙣𝙩𝙤 𝙖𝙘𝙘𝙤𝙪𝙣𝙩 𝙩𝙝𝙚 𝙙𝙚𝙛𝙡𝙖𝙩𝙞𝙤𝙣𝙖𝙧𝙮 𝙞𝙢𝙥𝙖𝙘𝙩 𝙤𝙛 𝘽𝙉𝘽:
Opposite to ETH which has infinite supply,. BSC has a fixed total supply ,meaning that ETH with its

@BinanceChain @binance @cz_binance 3.2/ mechanism can generate more coins to balance with the deflationary effect of burning coins, keeping the price of ETH from moving too quickly while BNB has no way to avoid deflation. The burning of coins on a quarterly basis and burning coins from transaction fees

@BinanceChain @binance @cz_binance 3.3/ certainly create a huge deflationary pressure on BNB which is considered to be good for BNB price and investment aspect, but possibly harmful in terms of application. BNB is the main currency used in countless projects of the BSC ecosystem with multiple utilities, and if

@BinanceChain @binance @cz_binance 3.4/ the $BNB price becomes too high, will users be willing to spend it as utility token or just holding $BNB ?

𝘾𝙤𝙣𝙛𝙡𝙞𝙘𝙩 𝙬𝙞𝙩𝙝 𝙞𝙣𝙞𝙩𝙞𝙖𝙡 𝙩𝙤𝙠𝙚𝙣𝙤𝙢𝙞𝙘𝙨
In the whitepaper, Binance states that BNB will be burned on a quarterly basis until the total supply

@BinanceChain @binance @cz_binance 3.5/ is only 50% - 100 million BNB. However, BEP-95 asserts that the mechanism of burning coins through transaction fees will continue even after the 50% of total supply is reached. This make a confuse in community because clearly it’s conflicting with the initial tokenomics.

@BinanceChain @binance @cz_binance 3.6/ Binance hasn’t made any announcement relating to this proposal. Even so, @cz_binance retweeted the announcement of Binance Smart Chain's BEP-95 and it may be considered as a "green light" for this proposal

@BinanceChain @binance @cz_binance 4.1/ Final words: BEP-95 is still at the proposal stage and needs to be reviewed by the community as well as waiting for approval from Binance before it is officially applied. Also recently there have been some comments that burning no longer has much impact on the value of BNB

@BinanceChain @binance @cz_binance 4.2/ due to unlocking more than burn. But if we look at what ETH has achieved in the period after the official implementation of EIP-1559, we have the right to hope for what BEP-95 can impact and create an impetus to $BNB value.

@BinanceChain @binance @cz_binance 4.3/ Hopefully, in the upcoming time, we can see the complete proposal of BEP-95 including solutions to some concern mentioned in this thread.

Disclaimer: The analysis towards this proposal is our POV and must not be considered as advice.