Osmosis Completes Its Monthly Token Burn, Permanently Removing 164,000 OSMO Tokens from Circulation

Osmosis has completed its monthly token burn, permanently removing 164,000 OSMO tokens from circulation. This initiative is part of an ongoing deflationary mechanism

Osmosis, the decentralized exchange on Cosmos, has completed its monthly token burn, permanently removing 164,000 OSMO tokens from circulation.

This initiative is part of a broader deflationary mechanism where 50% of the OSMO tokens collected from taker fees are burned each month.

The burning procedure, which began in April, also sees 50% of the OSMO tokens used for liquidity mining payees being returned to the protocol.

Since the commencement of this initiative, approximately 3 million OSMO tokens have been eliminated from the total supply.

This burning activity contributes to long-term supply reduction and may aid in setting the stage for potential value optimization for OSMO token holders.

In total, 164,000 OSMO tokens were burned this month, part of a broader initiative to reduce the total OSMO token supply.

Annually, the protocol can burn a maximum of 10% of the total OSMO tokens. However, this rate is dependent on the volume of trading activity on the exchange.

Osmosis is a decentralized exchange that operates on the Cosmos network. Osmosis utilizes Inter-Blockchain Communication (IBC) technology, which enables cross-chain asset transfers. This allows users to transfer assets between different blockchains within the Cosmos ecosystem without leaving a single platform.

One of the key features of Osmosis is its use of an Automated Market Maker (AMM) model, which allows users to provide liquidity to pools and earn fees. Users can also stake their tokens and receive rewards.

The OSMO token is a governance token that grants staked token holders the power to shape the future of the protocol. It allows them to make decisions on various aspects, such as voting on protocol upgrades, determining the allocation of liquidity mining rewards for bonded liquidity gauges, and setting the base network swap fee.