Burn Address
A burn address is a cryptocurrency address with an unspendable balance. It can be used to permanently remove coins from circulation, thereby reducing the circulating supply of that particular cryptocurrency. The concept was introduced by Ethereum founder Vitalik Buterin in 2017 as part of his work on the ERC-20 token standard and has since been adopted by many other cryptocurrencies such as Bitcoin Cash and Dogecoin.
The purpose of creating a burn address is to reduce the total number of tokens or coins within a blockchain network, which then increases their scarcity and theoretically leads to higher market value for each remaining coin (similarly to how gold becomes more valuable when supplies are restricted). This also helps prevent inflation due to oversupply caused by malicious actors attempting double spending attacks or other fraudulent activities.
Creating a Burn Address
Creating a burn address requires sending funds into an unspendable wallet where no private key exists therefore preventing any access or movement away from it. To do this users must first generate an empty public/private key pair using specialized wallets like MyEtherWallet, MetaMask, etc., before transferring funds into its public key associated with the respective crypto asset they wish to “burn” (i.e send out of circulation). Once sent these assets will remain locked forever without possibility for retrieval – thus removed from general circulation and added onto burnt supply totals at exchanges & services tracking them accordingly .
In conclusion while there may not yet be widespread usage cases for burning addresses today; given their utility in helping maintain stable pricing models across various types cryptos & tokens we expect wider adoption going forward especially amongst projects looking towards larger scale use cases involving digital assets backed securities & commodities trading markets
