A historic token burn is sending this crypto sky high.
The crypto token OKB (OKB 119.73%) is exploding today, up 121.8% in the last 24 hours as of 3:45 p.m. ET, having gained as much as 192.3% earlier in that period. The jump comes as the S&P 500 and Nasdaq Composite were relatively flat.
The native token of the cryptocurrency exchange OKX, OKB just saw its supply cut in half in what is one of the largest token burns in crypto history.
Massive token burn drives OKB higher
OKX will execute a one-time burn of roughly 65.26 million OKB tokens worth about 7.6 billion by sending them to an unreachable wallet. This will effectively cut the total supply of OKB in circulation by 52% and permanently cap it at 21 million.
The token price immediately soared after OKX announced the move, from about $46 to a high of $142 before retreating to its current level of about $104. Trading volume spiked 13,000% as holders tried to capitalize on the upcoming supply shock.
Image source: Getty Images.
The burn is part of a larger move by OKX to move its operations from Ethereum‘s primary blockchain and onto its native L2 layer called X Layer. The move will help cut costs and speed up transactions.
The token is also benefiting from broader bullish sentiment in crypto, driven by today’s massive IPO of the Peter Thiel-backed exchange, Bullish.
Don’t count on this to continue
A burn of this scale is not going to happen again, and investors shouldn’t jump into OKB expecting another one to follow. I would avoid buying this crypto and many niche altcoins like it. For investors looking for exposure to crypto, stick to the “OGs” like Ethereum and Bitcoin.
Johnny Rice has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin and Ethereum. The Motley Fool has a disclosure policy.