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ATOK M2E Token Burning: Does It Induce Deflation?

5 min read -June 12, 2024 by Dat Nguyen

ATOK M2E Token Burning: Does It Induce Deflation?

ATOK M2E Token Burning: Does It Induce Deflation?

The token-burning mechanism is essential for crypto projects due to its significant benefits. For users, researching and understanding the burn mechanism of projects they are interested in is also very important. So, how does ATOK's M2E token burn? This article is worth exploring.

1. Decoding the Deflationary Effect of ATOK's M2E Token Burning Process

1.1. What is deflation?

Token deflation refers to a decrease in the supply of a cryptocurrency or token over time. This is typically achieved through mechanisms such as token burning, where tokens are permanently removed from circulation. Deflationary mechanisms are employed to increase the scarcity of a token, which can, in turn, potentially increase its value.

1.2. Implications of Deflation

Token deflation has some key aspects that crypto holders should keep an eye on before investing. Token burning is the most common method, where tokens are sent to an unusable address (a "burn address") and permanently locked, reducing the total supply. Some cryptocurrencies have a fixed maximum supply that cannot be exceeded, so as tokens are used or burned, the total supply decreases relative to demand. Additionally, some projects reduce the rate at which new tokens are issued, often through mechanisms like Bitcoin's "halving," leading to fewer new tokens and increased deflationary pressure. Tokens can also be locked up in staking or other protocols, reducing the circulating supply without permanently removing them, as they are effectively out of circulation during the staking period.

1.3. The Mechanism of M2E Token Burning in ATOK

Decoding the Deflationary Effect of Atok's M2E Token Burning Process

Decoding the Deflationary Effect of Atok's M2E Token Burning Process

1.3.1. Objectives behind M2E token burning

The objectives behind M2E token burning aim to increase token scarcity, stabilize and potentially raise the token price, and enhance user engagement within the ATOK ecosystem. By reducing the total supply of tokens, burning can boost their value, attract long-term investors, and incentivize users to interact more with the platform, such as by upgrading NFTs or accessing features. This mechanism also supports a more efficient and cost-effective advertising environment, ensuring only serious advertisers participate. Overall, token burning helps maintain a healthy token economy, preventing inflation and ensuring the network's robustness and security.

1.3.2. Process of M2E token burning

ATOK’s M2E Tokens have the burning mechanism including:

  • M2E tokens will be burned when it is used for NFT purchases & upgrades and payments for services and goods at advertisers’ stores. 100% of the $M2E used for those purposes will be burned in full.
  • M2E token paid by advertisers for running ads on ATOK will be burned with a fixed proportion. Specifically, a third of advertising tokens are burned, while the rest are converted into user rewards and paid for ATOK’s system.

2. Benefits of M2E Token Burning

 Benefits of M2E Token Burning

Benefits of M2E Token Burning

2.1. Advantages of M2E Token Burning

2.1.1. Curbing Supply, Enhancing Token Value

M2E token burning significantly reduces the overall supply of tokens in circulation. By sending a portion of tokens to an unusable address, they are permanently removed from the total supply. This mechanism ensures that the remaining tokens become scarcer, potentially increasing their value as demand remains constant or grows. Enhanced token value can benefit current holders, encouraging them to maintain or increase their investments in the M2E ecosystem.

2.1.2. Creating Scarcity, Attracting Investors

Creating scarcity through token burning is a strategic move to attract investors. As tokens become less available, the perceived value of each token increases, making it a more attractive investment. Investors are often drawn to assets that promise potential appreciation over time, and a deflationary mechanism like token burning can provide this assurance. The scarcity effect also creates a sense of urgency among potential investors, prompting quicker investment decisions to capitalize on the limited availability of tokens.

2.1.3. Encouraging Token Usage

Token burning also plays a crucial role in encouraging active participation within the M2E ecosystem. Users are incentivized to utilize their tokens for various activities, such as upgrading NFTs, participating in staking, or accessing premium features. Knowing that a portion of the tokens they spend will be permanently removed from circulation can motivate users to engage more frequently with the platform. This increased activity not only supports the token’s value but also enhances the overall vibrancy and utility of the ecosystem, making it more appealing to both new and existing users.

3.

Is ATOK app right for you?

Is ATOK app right for you?

With the token burning mechanism and deflation control as mentioned above, ATOK has provided M2E token with a fairly good assurance of price control and market supply and demand regulation. This creates a more stable environment for investors and users, while also fostering trust and interest in the ATOK project.

ATOK is a new cryptocurrency project that emerged in 2024, introducing a new approach by integrating advertising and not solely focusing on promoting exercise and health improvement like previous Move To Earn projects. ATOK brings a fresh idea of creating a "reward-based mobile advertising platform." This project not only benefits users by providing a passive income source from using the app during their commutes and leisure time but also offers advertisers new marketing tools for targeted advertising using real-time location-based big data. This establishes a novel advertising platform where advertisers can reduce advertising cycles and costs.

Learn more about ATOK: https://linktr.ee/atok.m2e