Steemit Crypto Academy Contest / S5W4 - Token Burn | by : @waterjoe

Hi Steemian friends good night

I read an interesting contest theme about burning tokens from the award prizes I received with the tag settings I usually make, namely burnsteem25, so it made me very interested in participating in writing

Token burn is the burning of currency to limit its circulation in the crypto market. The supply of supply is limited so that demand will continue to occur and in an effort to increase the price of cryptocurrencies

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The first illustration is an example, a red chili farmer who plants simultaneously in a very large area. When all farmers' gardens carry out harvests simultaneously, it certainly produces thousands of tons of fresh chilies. This very abundant production exceeds to meet the needs of its residents so that the selling price of red chili drops drastically. Residents began to store a lot of red chilies in their kitchens so that demand began to decline as a result many red chilies were no longer sold and began to rot in the farmers' warehouses.

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Beginning farmers experience losses due to the large number of stocks that exceed market demand. At the beginning, before the harvest occurred in the market, red chili was still scarce, so that there was a lot of consumer demand, even though the price was expensive, but residents still bought it. To control prices so that they remain stable, careful calculations must be made to estimate how many tons of red chili residents need. Entering the red chili planting season, it also uses a large area of the garden which can be sufficient to meet market demand

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Other items as a second illustration can be seen from the types of stones that are around us. Stones that are very rare to find are of course gemstones such as diamonds if the price is definitely very expensive. The selling value can reach hundreds of millions of rupiah, the more rare and difficult it is to get certain types of stone, the price with its selling value is very fantastic soaring. Other stones are easy to get in large quantities, so the price is cheap. Having a high selling value, rare objects become unique and expensive valuables

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List the benefits of token burning with a detailed explanation of each

Burmsteem25	Deliberate burning of 25% of the steem currency to limit the supply so that 25% of steem can no longer be used to zero and will be renewed again
Impact	Steem supply dwindling
Counting	Economically, there will be a shortage of supply so it will be scarce so the demand for Steem currency will increase
Positive side	Steem currency prices are getting high
Income	Investors become profitable and will not lose by burning steem, otherwise the steem investment will increase

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Why does blockchain burn its tokens? The blockchain burns its token by identifying the results obtained.

The process of burning steem is a unique way run in blockchain companies to withdraw the amount of circulating steem currency.

For price stability in the market to be guaranteed, it is important to keep the supply of Steem tokens circulating in the crypto market reduced by burning 25%. Existing circulation is only with a supply stock in the market of 75% and will never reach 100% value, this is to maintain demand so that the token price goes up. The figure of 75% illustrates the need for Steem tokens that are still there and never enough. The 75% limit value which states that another 25% has not been fulfilled will affect the price of the token sale itself, as a result there will be demand to fill the supply of tokens that are lacking. The burning of 25% steem tokens results in a permanently empty ring reading of 25% so that there is an ongoing market demand to fulfill this deficiency. The price will drop when the stock of tokens on the market exceeds the threshold or if there is too much supply of tokens circulating, the price of Steem will fall

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The burmsteem25 company that drives burning 25% of my publishing revenue?

I think this will help increase the value of the steem currency in the medium term because the supply of crypto tokens is still not full by 25%. Market demand will always be there to make the value of the Steem currency go up. Limit supply so that demand continues to meet demand that is still empty, which is 25%

Conclusion

If the supply of steem currency in the crypto market is rare, it certainly makes the price of steem go up

If the supply of steem currency in the crypto market matches the demand, the price will be stable

The supply of steem currency in the market is too much in circulation, resulting in a drastic drop in prices

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That's what I wrote in an effort to enter a contest with the theme Token Burn organized by @crypto-academy

Special greetings to all my Steemian friends

About me 👉@waterjoe