Uniswap’s founder, Hayden Adams, took a surprising step on October 20 by burning 99% of the HayCoin (HAY) supply, as announced on X (formerly Twitter). This significant move was driven by Adams’ concerns regarding the price speculation that had been circulating around the token.
Notably, the HAY token had been deployed by Adams for testing purposes five years ago, predating the launch of the Uniswap decentralized protocol. He had initially created a small test liquidity pool with a minimal fraction of the total supply, retaining over 99.9% of the HAY tokens in his wallet. However, in recent weeks, HAY token trading had taken on the characteristics of a memecoin, with prices reaching six figures.
Adams expressed his surprise at witnessing significant trading activity involving HAY tokens and the treatment of the token as a memecoin. He emphasized the peculiar and unpredictable nature of the crypto space.
Five years ago, before the launch of Uniswap v1, I deployed a token called HayCoin to use for testing. This was back when gas was so cheap that mainnet could be used as as a testnet. After the launch of v1, I created a small test liquidity pool with a tiny fraction of the total…
— hayden.eth 🦄 (@haydenzadams) October 20, 2023
According to Adams’ statement, approximately $650 billion worth of HAY tokens were burned. The founder described the price speculation as “silly” and indicated his discomfort with owning almost the entire supply of a token associated with memes and speculation. Consequently, he decided to burn the full amount held in his wallet.
When a token is burned, it is permanently removed from circulation. However, this action can have inflationary effects on the token’s price, as it reduces the available supply. At the time of writing, the HAY token was trading at $4,032,971, reflecting a remarkable increase of over 78.06% in the past 24 hours, according to Coinmarketcap.
![Uniswap Founder Burns $650 Billion HayCoin to Prevent Speculation image 112](https://i0.wp.com/nosisnews.com/wp-content/uploads/2023/10/image-112.png?resize=975%2C396&ssl=1)
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Adams’ decision to burn the tokens garnered attention and generated discussions within the crypto community. Some users pointed out that such a token burning could potentially be viewed as a taxable event. Assuming a cost basis of $0, a disposal of approximately $650 billion could result in a long-term capital gains liability of around $128 billion, as highlighted by a user.
Additionally, some individuals suggested that Adams could have sold the tokens before burning them and donated the proceeds. This unique event underscores the dynamics and complexities surrounding the crypto space, where actions taken by key figures can have significant implications for the tokens and the community at large.
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