BONK Rallies As Burn Event Commences, But Supply Impact Will Be Minimal

BONK, a top five memecoin by market cap, is rallying as the project gears up for a major token burn event. However, the burn may not live up to the hype.

The price of BONK is up nearly 100% over the past seven days, ranking it as the third-best-performing meme token among the sector’s top 25 assets by market cap. BONK is now the 39th largest cryptocurrency with a $3.53 billion capitalization, according to CoinGecko.

BONK’s bullish momentum comes as the project gears to burn a targeted 1 trillion tokens ($50.9 million) on Christmas day as part of its BURNMas campaign. As part of the campaign, Bonk will burn tokens every time a user interacts with the project’s ecosystem in some way, such as trading on Bonk’s platforms, tweeting about Bonk, and following the project’s social channels, Each action corresponds to a fixed value of burned tokens.

“BURNmas transforms everyday community engagement within the BONK ecosystem into meaningful token burns,” Bonk said. The project added that by stimulating ecosystem engagement, the project seeks to create a “powerful network effect” driving organic demand and adoption.

The campaign began on Nov. 15 and will last until Dec. 24, with the total sum of tokens determined by the volume of engagement generated on the platform.

Limited impact

However, the event is unlikely to drive a significant reduction in BONK’s supply.

According to CoinGecko, nearly 69.5 trillion of a total of 196.4 trillion BONK are currently in circulation, with 20% of the token’s supply subject to a three-year vesting period that will expire in January 2026. Data from Tokenomist also indicates that 19.16 billion BONK enter supply every day.

Should the BURNMas campaign succeed in driving 1 trillion worth of token burns, just 0.5% of the asset’s total supply and 1.44% of circulating supply would be destroyed. Further, the burn would undo just 52 days worth of token emissions.

On Nov. 15, the Bonk community also passed a governance proposal to burn 100 billion BONK tokens ($5.09 million).