Topic: How a token burn works? - page 2. (Read 220 times)

BlackHatCoiner

legendary

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Farewell, Leo

Quote from: PercT4b on October 03, 2021, 04:59:10 AM

but I would like to know how technically this process work, how do they can access the tokens present in your wallet and send them to the burn address

What kind of projects follow this type of mechanism? It sounds horrible.

Proof of burn tokens are usually dependent of other blockchains and in order to be rewarded with new tokens you'll have to burn coins from the X blockchain. For example, I could send a specific amount of bitcoins to a burn address (or make an OP_RETURN transaction) and be rewarded with tokens analogously with the amount of coins I burnt.

PercT4b

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Many projects utilize this process for many reasons, including to forcibly make the price rise (this method is particularly used by scammy projects) via reducing the supply of the token.

The question I have is: how do they do that?

I know the classic way which is all about to send the tokens to a "black hole address" which de facto makes them unusable, but I would like to know how technically this process work, how do they can access the tokens present in your wallet and send them to the burn address (this is basically how some scams work), feel free to go deep with details, I'll try my best to understand the process.

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