OKB surges after OKX cuts supply with massive token burn
- OKB surges over 150% amid massive network changes, including a major token burn.
- The burning of around 65 million OKB tokens caps the total supply at 21 billion.
- OKX exchange announces the discontinuation of OKTChain, fueling the migration to the X layer.
OKB, the native token of OKX’s X layer, surges over 150% at press time on Wednesday, fueled by the announcement of a 65 million token burn that led to a sharp decline in the total supply cap to 21 billion tokens.
OKX ecosystem boost plans a total shift to the X layer
The OKX exchange announced a complete migration to the X layer, a zkEVM-based public chain launched in 2023 in collaboration with Polygon, on Wednesday. The strategic decision aims to capitalize on the resurgence of Decentralized Finance (DeFi) and Real-World Asset (RWA) use cases.
Following the PP upgrade on August 5, the X layer provides 5,000 transactions per second (TPS) at negligible gas cost.
To boost its ecosystem, OKX plans to establish an ecosystem fund and incentivize developers as it develops cross-chain functionalities. Furthermore, the ecosystem will integrate OKX Wallet, OKX Exchange, and OKX Pay based on the X layer, loaded with features such as 0 Gas fast withdrawal.
The launch of new products and services built on its X layer is expected to boost demand for its OKX native token, provided the ecosystem adoption increases.
OKTChain discontinuation and the burning of 65 million OKB
The exchange also announced the decommissioning of its OKTChain due to the increasing overlap with the X layer. This starts on Wednesday, and the exchange will automatically convert the OKT tokens to OKB from Friday.
Along with the chain migration, the OKB tokenomics will undergo a massive change. The exchange will conduct a one-time burning event of 65.25 million OKB tokens from previous buybacks and reserves to adjust the total OKB supply to 21 million on Friday. This massive deduction in available supply skyrockets demand, underpinned by the major ecosystem revamps.
Ethereum Layer-1 OKB token holders are urged to swap their tokens on the OKX exchange using the "Withdrawal to X Layer" feature, as future OKB withdrawals on the Ethereum chain will be unsupported.
To maintain a fixed supply, the OKB smart contract upgrades will be completed on Monday to remove the mint and burn functionalities.
Author
Vishal Dixit
FXStreet
Vishal Dixit holds a B.Sc. in Chemistry from Wilson College but found his true calling in the world of crypto.
