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Celsius Network Burns Majority of CEL Tokens
Celsius Network, a prominent cryptocurrency platform, made a significant move by burning the majority of its CEL token holdings on April 30. According to Etherscan, the company successfully burned 652.2 million CEL tokens by sending them to a null address. This amount represents a whopping 94% of the previous total supply, which stood at 692.8 million CEL tokens, valued at approximately $83.2 million based on current market prices.
The token burn transaction effectively reduced the remaining circulating supply to 40.6 million CEL tokens, as reported by CoinGecko, which promptly updated its data to reflect the burned amount in real-time. The wallet responsible for initiating this transaction was linked to Celsius Network, as confirmed by Arkham Intelligence data.
Impact on Market Value
Token burns like this can have significant implications on the market value of an asset. By reducing the overall supply of CEL tokens, there is a potential for an increase in price if demand remains steady. In the hours surrounding the burn event, the value of CEL experienced a modest uptick from 13.0 to 13.7 cents, marking a 5% increase.
However, when looking at the broader market trends, both CEL and the cryptocurrency market as a whole have encountered some losses. Over a 24-hour period, the crypto market dipped by 4.4%, with CEL following suit with a 5.3% decrease in price.
Bankruptcy Burn Plans
It’s worth noting that back in September 2023, Celsius had disclosed its intentions to burn all CEL tokens under its possession as a part of its bankruptcy reorganization plan. The company emphasized that it could only burn the tokens within its control and not those held by external parties or available for trading on exchanges.
In a strategic move, Celsius presented the token burn as a means to assign a specific value to the CEL token, suggesting a price point of $0.25 per token. This valuation aligns with the company’s efforts to reorganize and address its financial obligations, which includes distributing $3 billion worth of cryptocurrency to creditors as announced earlier in January.
Despite these developments, Celsius Network has remained tight-lipped and declined to provide any further comment on the recent token burn.
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