On October 20, 99% of the HayCoin (HAY) supply was destroyed by Uniswap founder Hayden Adams, according to a tweet. Adams’ worries about price speculation over the previous days led to the removal of the majority of the tokens from circulation.
Before the release of the decentralised protocol Uniswap, five years ago, Adams released the HAY token for testing. Over 99.9% of the HAY tokens were retained in his wallet, and he only used a minor portion of the total supply to construct a test liquidity pool. A few weeks ago, the token was trading in the six figures like a memecoin“Over the years, a few people have noticed it and bought it as a joke/for the novelty of it. Was extremely surprised to see people buying and selling significant dollar amounts this past week, treating it like a memecoin. Crypto can be weird sometimes.“
About $650 billion worth of HAY tokens were torched, according to Adam’s message. In addition to calling price speculation “silly,” the creator of Uniswap stated that he does not want his profile image to be connected to the token:“Ultimately, I’m uncomfortable owning almost the entire supply (~99.99%) of a token that people are memeing and speculating on, so I decided to burn the full amount in my wallet (”valued” at an absurd ~$650b).“
A token is permanently taken out of circulation when it is burned. But since fewer units are available, it also has an inflationary impact on their price. The HAY token is currently trading for $2,392,640, up more than 235% in the previous day.
X was a little taken aback by Adam’s action. Users brought up the possibility that the token burning might be regarded as a taxable event in addition to the effect on the HAY price. Assuming a cost basis of $0, a disposal of $650 billion results in a liability for $128 billion in long-term capital gains, the user said.
Others claimed that Adams may have given the proceeds from selling the tokens before burning them.