Stellar Burns $4.7 Billion Worth of XLM

The Stellar Development Foundation (SDF) has burned over half of XLM’s supply in an effort to become more efficient, the foundation announced in a blog post on 5 November.

The move was also announced by CEO Denelle Dixon, who was speaking at the Stellar Meidian conference on Monday. From the total 105 billion XLM tokens, of which 20 billion were in circulation, 55 billion of the SDF’s tokens were destroyed. The majority of the burned tokens came from giveaway programs, which now only has around 6 billion lumens.

According to the blog post, the organization also decided to end its World Giveaway Program and the Partner Giveaway Program, both of which were created at the beginning of the network, and burn 50 billion XLM that were allocated to them.

The organization then projected how much lumens it will use over the next 10 years, and burned another 5 billion from its Operating Fund.

The blog post reads:

“SDF can be leaner and do the work it was created to do using fewer lumens. Over the years we’ve also seen that giveaways and airdrops have diminishing effects, especially in the outsized amounts our original plan was designed to support. So a smaller public-facing program would have just as much impact.”

The SDF now controls around 30 billion XLM, which are divided into several buckets. The foundation has said that 12 billion of the remaining tokens will go towards “an aggressive program of direct development and advocacy for Stellar”.

2 billion were allocated for “ecosystem support”, while 1 billion was put aside for infrastructure grant programs. Stellar also left 10 billion XLM for investments, and 6 billion tokens for marketing and in-app promotions.

The question of removing the Stellar protocol inflation feature has been around for around a year, first being proposed in October 2018. The SDF first revealed its intention to use an upcoming upgrade to remove the feature at the end of last month.