This is a guest post from the Binance exchange
Binance Smart Chain has attracted great enthusiasm and trust from the blockchain community since its launch on September 1, 2020. As the initiator and key participant of the developing Binance Smart Chain community, Binance has been enthusiastic in working with all developers, projects, and users in this exciting domain. We also recognize that these early adopters and brave pioneers take the risk and push the boundaries of innovation.
As with all the other things in their early days, the Binance Smart Chain ecosystem (and the whole blockchain ecosystem in general) is at its early stages. Many functions are still not as user-friendly as they could be, and still require further development. For this part, we are working with many blockchain projects to improve these functions.
A few days ago, we learned that one of the BNB holders mistakenly transferred 867 BNB (worth around $20,000 at the time) to a smart contract address, which nobody has control over, essentially deeming it lost. (The transaction can be spotted here). This is not an isolated case when it comes to crypto transactions, especially those involving new blockchains, and we are sensitive towards honest mistakes that may lead to financial losses to BNB holders, users, and supporters.
People say “Code is Law,” and we are fascinated about this concept. However, on the other side, we respect more of the spirit of law. Part of our mission on Binance is to bring more financial fairness and freedom. It’s more important for us to care about our customers and users. It is not consistent with our value system to simply ignore individual tragedies, especially if that individual is a blockchain pioneer who loves trying new things in the new Binance Smart Chain ecosystem. We believe that this common consideration has been recognized through the whole community.
BNB is a fully decentralized crypto token, so we cannot move or touch the BNB in those addresses. That 867 BNB is lost, out of circulation, and cannot be spent forever. BNB is not inflationary, so nobody can print more BNB to compensate for their loss.
Fortunately, you can burn BNB. Today we want to introduce a new logic for our token burn procedures: the BNB Pioneer Burn Program. We expect this to be accepted as the humane part in the world of decentralization and code.
How the Pioneer Burn Works
Binance.com is willing to exert its best effort to help the users who lose their assets in the following cases below:
1. The lost tokens are either BNB, “wrapped” tokens (e.g. WBNB), or “pegged” tokens (e.g. BTCB) supported via the Binance “Token Canal” Project;
2. The lost tokens are transferred to BEP20 contract addresses that are verified on bscscan.com, so that the loss can be publicly justified or recognized as moving the asset out of circulation and cannot be brought back forever;
3. The loss is from an honest mistake and is worth more than 1,000 USD, but is less than the projected BNB burn amount in the upcoming quarter.
Binance will cover your losses for the cases accepted for this initiative, with the following steps:
STEP 1: The user submits the case via Binance.com customer support channels.
STEP 2: Binance investigates and confirms if the case is qualified for the program.
STEP 3: Binance reserves the amount of the tokens needed for the case, and does the following:
– For “pegged” tokens via our Token Canal project (tagged “Binance-Peg” as listed here), Binance will mint extra corresponding tokens and send the tokens back to the originating address of the case (with fees deducted). This extra amount will not be counted as part of increased total supply.
– For BNB, Binance will send BNB to the originating address of the case (with fees deducted). The number will be counted as part of the total BNB burned in the next quarterly burn.
How will this affect our quarterly BNB burn events? Here’s a hypothetical example:
Assume 1,000,000 BNB will be burned in the upcoming BNB burn event for the third quarter of 2020. However, before the event, we had returned 5,000 BNB to users through the BNB Pioneer Burn program. As a result, for our Q3 burn, we will burn 995,000 BNB instead (the original 1,000,000 BNB burn amount minus the 5,000 BNB that went to the BNB Pioneer Burn program).
We understand accidents happen, especially when working with new and emerging technology. Through the Pioneer Burn program, we hope that early adopters will feel more supported by a growing community. We hope all our early adopters are encouraged to bring in more innovative products to the world.If you need help for losses like the one we explained above, please contact Binance 24/7 Customer Support, and mention “Pioneer Burn.”