What is HTX new destruction strategy and how does it works

Answered at Nov 03, 2024

HTX's New Destruction Strategy

HTX has recently announced a significant shift in its token management strategy, moving towards a full destruction model. This change aims to enhance the value of the $HTX token by reducing its supply more aggressively. Here's a breakdown of how this new strategy works and its implications.

Transition from Liquidity Donations to Full Destruction

Previous Strategy:

  • Liquidity Donations: HTX previously ran a dual strategy involving liquidity donations and token destruction. The HTX DAO facilitated liquidity donations by adding HTX/TRX liquidity to decentralized exchanges (DEX) on the TRX chain. Afterward, the liquidity pool (LP) certificates were destroyed (source).
  • Token Destruction: Tokens were destroyed using transaction mining fees, sending them to a "black hole" address on the TRX chain for permanent removal.

New Strategy:

  • Unified Destruction: HTX has decided to phase out the liquidity donation process. Instead, it will focus solely on token destruction. This unified approach aims to reduce the token supply more effectively, potentially increasing the market value of $HTX (source).

Recent Token Burn and Future Plans

  • Q3 2024 Token Burn: HTX completed a significant token burn in the third quarter of 2024, eliminating 15.81 trillion $HTX tokens valued at $21.25 million. This burn is part of a broader effort to enhance the token's value through strategic supply reduction (source).
  • Total Burn and Donations: Since March 2024, HTX has burned a total of 23.61 trillion $HTX tokens and donated 16.04 trillion $HTX and 163 million $TRX in liquidity, with the overall value of destroyed and donated assets reaching $72.75 million (source).

Sustained Burn Strategy

  • Future Burns: HTX DAO plans to continue burning 50% of HTX’s quarterly revenue in $HTX. The next scheduled burn is set for January 15, 2025. The size of future burns will depend on changes in quarterly revenue (source).
  • Long-term Benefits: This sustained burn strategy is expected to provide stability and growth potential for $HTX tokens. HTX DAO believes this approach will bring more long-term benefits to its users and the wider community (source).

Implications for HTX Token Holders

  • Price Stability and Growth: By reducing the circulating supply of $HTX, the new destruction strategy aims to enhance scarcity, which could support a steady increase in $HTX prices over time (source).
  • Community Involvement: HTX DAO's decentralized governance structure encourages community participation, allowing users to propose ideas that can promote the development of HTX DAO (source).

Conclusion

HTX's shift to a full destruction model marks a strategic move to enhance the value of its token by aggressively reducing supply. This approach, coupled with a sustained burn strategy, is designed to provide long-term benefits to the HTX community and support the token's market value.