What is
The process of permanently removing cryptocurrency tokens from circulation, usually by sending them to an unspendable address.
The process of permanently removing cryptocurrency tokens from circulation, usually by sending them to an unspendable address. Burning tokens reduces supply and can be used to increase scarcity, manage inflation, or as part of a protocol's mechanism.
Common questions about this topic
Building DeFi on Ergo starts with understanding the eUTXO model and ErgoScript. Unlike account-based chains, Ergo's box model provides deterministic execution, strong MEV-resistance, and predictable fee construction. Use Oracle Pools for price feeds, and study existing patterns from Spectrum Finance and SigmaUSD.
eUTXO (Extended Unspent Transaction Output) is Ergo's smart contract model that extends Bitcoin's UTXO with programmable logic. Each 'box' contains ERG, tokens, data registers, and a guarding script. Transactions consume boxes and create new ones, enabling deterministic execution, parallel processing, and no protocol-level reentrancy by construction.
Ergo provides tools for financial sovereignty: self-custody with no third parties, censorship-resistant transactions via PoW, optional privacy with Sigma Protocols, and programmable money without permission. Unlike VC-backed chains, Ergo has no central authority that can freeze funds or comply with sanctions. Your keys, your coins, your freedom.
Ergo had no pre-mine, no ICO, no VC allocation. 100% of ERG enters circulation through mining. That removes a major insider-allocation overhang and makes governance less dependent on early investor exits. Long-term decentralization still depends on active miners, users, builders, and community participation.