Glossary

Mint and burn

Minting creates new tokens and adds them to the supply. Burning destroys tokens and removes them from the supply.

Minting is the creation of new tokens by a smart contract or an issuer. Burning is the permanent removal of tokens, usually by sending them to an address that nobody can spend from. Both actions are recorded on the blockchain, so anyone can verify them.

The reasons differ by token type. A fiat-backed stablecoin issuer mints tokens when a customer deposits money and burns them when the customer redeems. Other projects burn a part of fees, or they burn tokens on a schedule, to lower the supply over time.

Net supply change equals minted tokens minus burned tokens over a period. A burn does not raise the price by itself. Demand and the reason for the burn also matter. Compare mint and burn data with the circulating supply to see how large the change is.