Floki Inu DAO burns $100M worth of FLOKI in approved proposal

The Floki Inu community made their voices heard, overwhelmingly supporting a bold governance proposal: burning 4.2 trillion FLOKI tokens on a cross-chain bridge, along with a decrease in transactional tax.

99.97% of the members voted in favor of setting the bridge tokens ablaze. Only 0.03% dared to dissent. Come 8 PM UTC on Feb. 3, the FLOKI transaction tax will be lowered to 0.3%, while the 4.2 trillion tokens will meet their fiery demise at 8 PM UTC on Feb. 9, 2023, according to the developers.

Initially valued at $55 million, the token price skyrocketed to a value of $102 million by the time the DAO vote came to a close.

Security issues on bridges are another reason for the burn

Meanwhile, cross-chain bridges saw over $2 billion vanish into the ether, either lost or stolen, with last year serving as a prime example.

“New revelations and evidence have surfaced highlighting the dangerous potential of cross-chain bridges, particularly if they control a substantial portion of a token’s supply,” the proposal warned.

“For Floki, a breach of our central cross-chain bridge would spell disaster, as it holds a staggering 55.7% of FLOKI’s intended circulating supply. That’s a huge amount of tokens at risk, and if exploited, it would decimate the project’s liquidity pools and bring about its downfall,” the developers ominously declared in their approved proposal.

Furthermore, in their quest to elevate Floki Inu to a reputable decentralized finance (DeFi) player, the team has recently debuted projects like Floki Locker and the metaverse game Valhalla.

The Floki bridge

Floki first unleashed its token onto the Ethereum network, offering 10 trillion tokens. However, in response to community demand, they galloped towards the quicker and more economical BNB Chain in 2021, eager to provide a better experience for their supporters.

Moreover, to fulfill its promise of a 10 trillion token supply, the Floki team had to unleash another contract on the BNB Chain with an equal amount. Additionally, a cross-chain bridge was created to ensure that the FLOKI in circulation never exceeded 10 trillion and to let users seamlessly traverse between Ethereum and BNB Chain with their FLOKI tokens in tow.

Back then, the Floki team dipped into their treasury, wielding 600 billion tokens from both Ethereum and BNB Chain, to lay the foundation for the cross-chain bridge.

Since then, a majority of FLOKI holders have locked their tokens on Ethereum and ferried them to the BNB Chain. “The current balance of tokens is stable enough that removing the bridge wouldn’t pose a threat to the project’s stability, despite the majority of tokens still residing on Ethereum,” Floki developers on the proposal.

FLOKI price on Jan 30, 2023 is $0.000023 USD which is down 6.38% in the last 24 hours.