Today, Bitmain-owned mining pool AntPool announced that they are now burning 12% of their BCH transaction fees:
Their official announcement doesn’t really indicate why they’re undergoing such a drastic measure; instead, they’ve opted to give us a largely incomprehensible statement about the “forthcoming wave of innovation” for Bitcoin Cash.
So what’s going on here — why is AntPool reducing the total supply of BCH?
This is a massive signal of confidence by one of Bitcoin Cash’s biggest mining pools. By burning their tokens, AntPool is demonstrating its belief in Bitcoin Cash’s long-term viability. This should in turn improve overall BCH investor confidence as well.
This is a desperate move to pump the price and shows that there is little organic demand for BCH. By burning some of their coins, AntPool is signaling that market demand for BCH is clearly not enough to meet its supply.
Before we get ahead of ourselves, let’s quickly crunch the numbers on how much money we’re talking about here. Here are the latest 24-hour mining stats for BCH:
So, (15 blocks mined)*(.00609139 avg. tx fees per block)*(12% burn)*($1070 market price of BCH) means that AntPool has only burned $11.84 worth of BCH in the past 24 hours! Ultimately, this nothing more than a token signal of strength for Bitcoin Cash.
All things considered, I’m not sure there’s as much of a story here is we originally thought.
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