Decentralized crypto exchange CREAM Finance announced its decision to conduct significant token destruction after tough internal discussion.
The official account of the exchange explained that, following the evaluation of several possible ways to reduce the amount of tokens in circulation, that of burning 67% of all CREAM tokens was chosen as the best. This implies that more than 6 million CREAM tokens will disappear forever once the operation is completed.
Goodbye, governance token
In an official post, the CREAM Finance team explained that all governance tokens and 7,5% of token seeds would be destroyed. “The operation will include 100% of the governance tokens and 7,5% of the seed tokens.
We believe that, in this way, current token holders will be able to have greater certainty, while creating a more solid foundation for the long-term success of the project. " Tokens owned by liquidity providers, those intended for the development of new protocols and Compounds will not be affected by the measure.
Therefore, the liquidity providers will now control 61,5% of the total CREAM supply while the team would have 23,1%. This redistribution is made possible by the absolute removal of the governance tokens, which until now represented 60% of the total offer.
“We thank our seed token investors for their continued support and sacrifices made for the project, they agreed to the 7,5% removal in exchange for accelerated maturation that goes from annual to monthly. In other words, seed tokens will now mature monthly starting September 24th. "
The CREAM team also had the opportunity to make the same decision as the seed investors. However, they refused to go that route, mostly for strategic reasons.
Less is more
As mentioned above, the token reduction is meant to reassure the current ones Investors of CREAM that the token value will not be diminished by the oversupply. A decline of this magnitude could have two implications: either a substantial loss of market capitalization (in the event of a lack of value or confidence in the project) or the price of each token will rise to match the current market capitalization with the new one. offer.
And in the case of CREAM, the news seems to have given exceptional results, with prices taking the most optimistic path. The token price rose almost immediately after the announcement. It went from around $ 70 to $ 165, marking a 134% increase.
Just a few days ago, Binance announced that it would list the Cream Finance token, CREAM, and open trading for the CREAM / BNB and CREAM / BUSD trading pairs.
