What is automatic BNB burning?

TL;DR (SUMMARY)
Coin burning is a mechanism used to remove coins from circulation, thereby permanently reducing their total supply. Many cryptocurrency projects periodically burn coins to create a deflationary effect.
BNB adopts two coin burning mechanisms, which will reduce its total supply by 50% in the long term. The first mechanism is to burn a portion of the BNB spent on gas fees on the Binance Smart Chain (BSC) (introduced in BEP-95). The second consists of quarterly BNB burning events.
Previously, quarterly BNB burns were based on BNB trading volume on Binance Exchange. However, in December 2021, Binance announced that the quarterly burn would be replaced by the new automatic BNB burn.
The BNB auto burning mechanism will automatically adjust the amount of BNB to be burned according to the BNB price and the number of blocks generated on BSC during the quarter. This offers greater transparency and predictability to the BNB community.

What is a coin burn?Coin burning is the process of permanently removing cryptocurrencies from circulation, thereby reducing the total supply of the currency in question. In other words, the coins are destroyed and can no longer be used for trading or any other activity.
By making the total supply of the currency scarcer, coin burning is intended to generate a deflationary effect and potentially increase the valuation of the cryptocurrency to benefit its holders. In the case of BNB, the goal of coin burn events is to gradually reduce the total supply until it falls below 100 million BNB.
While there are multiple ways to burn cryptocurrency, some projects implement a specific burning function as part of their protocol. For example, BNB included a smart contract burning feature when it was originally launched.
With the rise of Decentralized Finance (DeFi) protocols, coin burning has become more common in the blockchain sector. Ethereum (ETH) began burning the base ETH fee for all blockchain transactions after implementing the hard fork London upgrade in 2021.
To burn coins, a certain amount of crypto is sent to a smart contract or wallet address that cannot be used for transactions and does not have a private key. This means that as soon as the coins arrive at the address, they are lost forever and are therefore removed from the available supply.
For more details on how a coin burn works, see
What is a coin burn?

How do you burn BNB?BNB is the utility token that powers the BNB and BSC ecosystems. The initial total supply was 200,000,000 BNB, but it has been gradually decreasing through coin burning. Burning events will continue to occur until 50% of the total supply is destroyed, reducing it to less than 100,000,000 BNB.
There are two methods of burning BNB. The first consists of quarterly BNB burning events. The second was introduced in BEP-95 and consists of burning a portion of the BNB spent on gas fees on Binance Smart Chain (BSC).
Previously, quarterly BNB burns were based on BNB trading volume on Binance Exchange. However, in December 2021, Binance announced the new automatic BNB burning. The BNB auto burning mechanism automatically adjusts the amount of BNB to be burned according to the price of BNB and the number of blocks generated on BSC during each quarter. This offers greater transparency and predictability to the BNB community.

Quarterly BNB BurnAs of January 2022, 17 BNB burning events have taken place. A total of 33,199,679 BNB were burned, representing 16.59% of the total supply.
burning of coins
Burned BNB
Price approx. from BNB
Approx. value in USD
% of total supply
N.º 1 (Oct 2017)
986,000
1.52 USD
$1,500,000
0.49%
N.º 2 (Ene 2018)
1,821,586
21.96 USD
$40,000,000
0.91%
No. 3 (Apr 2018)
2,220,314
13.52 USD
$30,000,000
1.11%
No. 4 (Jul 2018)
2,528,767
12.93 USD
$32,700,000
1.26%
N.º 5 (Oct 2018)
1,643,986
10.34 USD
$17,000,000
0.82%
N.º 6 (Ene 2019)
1,623,818
5.83 USD
$9,400,000
0.81%
No. 7 (Apr 2019)
829,888
18.79 USD
$15,600,000
0.41%
No. 8 (Jul 2019)
808,888
29.47 USD
$23,800,000
0.40%
N.º 9 (Oct 2019)
2,061,888
17.80 USD
$36,700,000
1.03%
N.º 10 (Ene 2020)
2,216,888
17.50 USD
$38,800,000
1.11%
No. 11 (Apr 2020)
3,373,988
15.55 USD
$52,466,000
1.69%
No. 12 (Jul 2020)
3,477,388
17.40 USD
$60,500,000
1.74%
N.º 13 (Oct 2020)
2,253,888
30.17 USD
$68,000,000
1.13%
N.º 14 (Ene 2021)
3,619,888
45.80 USD
$165,791,000
1.81%
No. 15 (Apr 2021)
1,099,888
541.25 USD
$595,314,380
0.55%
No. 16 (Jul 2021)
1,296,728
303.59 USD
$393,673,653
0.65%
N.º 17 (Oct 2020)
1,335,888
478.68 USD
$639,462,868
0.66%
TOTAL
33,199,679
-
$2,220,707,902
16.59%
BNB Burn History (Quarterly Coin Burn).
In the 18th quarter (January 2022), BNB completed its first quarterly automatic BNB burn. A total of 1,684,387.11 BNB were taken out of circulation, including 6296.305493 BNB burned through the Pioneer Burning Program.
The BEP-95 burning mechanismIn early 2021, Binance CEO CZ shared his plan to accelerate BNB burns, as the overall burn pace was slower than originally planned. To speed up the process, Binance introduced a new burning mechanism via BEP-95 in November 2021.
BEP-95 is a Binance Evolution Proposal that adds a real-time burning mechanism to Binance Smart Chain (BSC). BSC automatically burns a portion of the gas fees collected by validators in each block. As more people use Binance Smart Chain, more BNB will be burned, effectively speeding up the burning process.
As of January 2022, BSC burns approximately 860 BNB each day, and you can track the progress on Twitter. Since BEP-95 relies solely on the BSC network, it will continue to burn BNB even after the 100 million BNB burning target is reached.

What is automatic BNB burning?As we have discussed, BNB auto burning will automatically adjust the amount subject to burning, according to the BNB price and supply and demand dynamics. This means that if the price of BNB falls, the amount of BNB burned will increase.
The automatic burning of BNB is both objective and verifiable. Its purpose is to provide greater transparency and predictability in transactions. Unlike quarterly burning, automatic BNB burning is independent of BNB trading volume on Binance Exchange. Instead, it uses information in the BSC chain to calculate the amount that should be burned.
As soon as the total circulating supply of BNB falls below 100 million units, the automatic burning of BNB will stop. However, the BEP-95 mechanism will continue to burn BNB. BNB auto burning follows a formula to complete the process automatically. This formula is based on data on the BSC chain about the total blocks generated and the average price of BNB:
B represents the BNB that will be burned. N is the total number of BSC blocks produced during the quarter. P is the average price of BNB, and K is a constant price anchor (initially set to 1000). For more details on how this formula works, you can check out this blog article.

How to check BNB auto burn history?Each burning event is publicly accessible on the blockchain and on the Binance website. You can also track burns on BNBBurn.info, a platform created by the BSC community.

ConclusionsSince its launch in 2017, BNB has evolved as a utility token in many ways. The blockchain sector is growing very fast, and so is the BNB and BSC ecosystem. The new automatic BNB burning will further optimize BNB burning mechanisms, improving its deflationary qualities and bringing more transparency to the community.