Crypto Community Has Mixed Reactions To Latest XLM Burn

The crypto community has mixed reactions to the major XLM coin burn that has finished recently by the Stellar Development Foundation as we reported earlier in our latest cryptocurrency news.

A few hours ago it was announced that the Stellar Foundation has destroyed 55 billion XLM tokens which were valued at around $3.8 billion at the time using circulating tokens prices. The move was revealed at the inaugural Meridian conference in Mexico and as most expected, the token price started to pump. XLM surged from $0.07 to top out at $0.09 according to the charts and it has now reached a six week high but the altcoin is still down by more than 80 percent from its 2019 peak.

The crypto price pump was rather predictable and the crypto community believes that another dump will happen soon because the token burn came from the total supply that is under control of the Foundation. The circulating supply of 20 billion remains unchanged and the industry observers have noticed this. The analyst and trader Luke Martin remained skeptical saying that a small number of individuals still control the crypto token supply.

‘’If $XLM can cut supply in half, they could also double it. Alts can be great trading opportunities. But it’s hard to justify holding many long-term with no ownership rights & at the mercy of a small centralized team.’’

He followed up with more commentary that this applies to altcoins in general and not only XLM which seems to have good intentions behind the burn. The foundation clarified in a press release:

‘’The network and community around Stellar are now robust enough to allow SDF to carry less weight, too–we’re just a piece of a much larger whole, and the funds we steward should reflect that. So: we’ve decided to reduce our lumen allocations and to rededicate what remains to what we now think Stellar needs most.’’

The trader Nick Carter also dug deeper into the numbers adding that the price pump is in no way reflective of the number of tokens burned:

‘’I’ll be the one to point out that the fact that XLM is only up 20% on the news (instead of 100%) that 50% of supply is being burned is solid evidence against the “burns are deflationary” thesis.’’