BONK is about to burn 1 trillion tokens - Will there be a $1 breakthrough?

At the end of November, the famous BONK meme coin development team based on Solana proposed to burn 1 trillion tokens that the community will contribute to in an event called BURNmas. On Wednesday, they announced that they had surpassed that goal and will now burn a total of 1.69 trillion tokens in a move that could push the BONK price to a new high.

As a result, Bonk is one of the few meme coins that has seen a 7% growth in the past 7 days, bringing a profit to its holders during this time. Notably, on December 20, when the project's founders announced that they had reached the initial milestone of 1000 billion, the price of BONK increased by 14%. However, this token still did not escape the retreat that the entire cryptocurrency market has gone through in the past few days, when the 30-day cumulative loss was 25.6%. Other tokens have also experienced similar declines during this period, including Dogecoin (DOGE), which dropped by 20.2%, and dogwifhat (WIF), which saw an even higher loss of 42.6% over the past 30 days. Burning tokens involves sending a certain amount of tokens to a specific cryptocurrency wallet used to store assets that will be permanently removed from the blockchain. A smart contract is created to automatically burn, and contributors are verified to ensure they own the amount of tokens they have committed to sending to the burn address. After execution, these tokens will no longer exist, and thus the total supply of assets will decrease. The main goal of token burning is to create scarcity. In theory, this will help increase the value of the asset over time if demand remains unchanged or increases. Data from CoinMarketCap shows that the current total supply of BONK is 92.66 trillion tokens. This means that a 1.69 trillion BONK explosion will reduce the circulating supply by 1.8%. BONK Continues to Drop as the Market Adjusts to the Federal Reserve's New Plan The BONK/USD chart shows a clear downward trend since reaching an all-time high on December 20th at 0.00005029 dollars.

This descending channel is formed when the asset creates a series of lower highs and lower lows along the way, often indicating significant weakness in demand for the token. The hawkish comments of the Federal Reserve in their latest monetary policy meeting have contributed to the decline in the value of some cryptocurrencies. The US central bank said they are now preparing to implement two interest rate cuts next year instead of the originally planned three. Market participants understand this as a sign that inflation could pick up again in the next quarter or two, potentially increasing the likelihood that the Fed could even halt the monetary easing process. Lower interest rates are generally beneficial for high-risk assets such as cryptocurrencies because investors have a risk-taking attitude and liquidity increases. Despite this temporary weakness, the entire meme coin sector has seen significant growth after Donald Trump declared victory in the US election in November. The prices of most assets have risen to new highs since then, and BONK is no exception, having achieved a 134.4% increase since the beginning of the year. Currently, the chart indicates that the price may continue to decline in the near future unless there is a breakthrough above the upward trend line at some point in the future. However, considering the significant increase that meme coins have recently achieved, this is a very necessary retreat, creating an opportunity for late buyers to enter the market at a more favorable price.