TON Foundation Makes Proposal to Burn Half of Network Fees

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The TON Foundation has put forward a proposal to introduce a burn mechanism on the TON network, aiming to destroy 50% of all transaction fees. This approach draws inspiration from Ethereum’s EIP-1559 upgrade, which successfully reduced network inflation by implementing significant burn amounts. However, the impact of this proposed burn on TON’s inflation level is expected to be relatively smaller due to the dominance of staking rewards compared to transaction fees.

Kirill Emelyanenko, a core lead developer at the TON Foundation, explained that the deflationary effect might initially appear modest, estimated at approximately 350-400 Toncoin per day, considering the daily issuance rate of 71,000 Toncoin. Nevertheless, as the network’s volume expands, this number has the potential to increase significantly, resulting in noticeable deflation in both the total and circulating supply of Toncoin.

If the burn mechanism is implemented, a portion of tokens from each user’s transaction will be burned, while the remainder will go to the validator as usual. The validator will also continue to receive staking rewards for their contribution to the network’s operation.