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One of the most important factors determining the price of a cryptocurrency is token supply. The unit price is shaped accordingly. The reason why meme coins have prices with a lot of zeros is because their market value is divided by quadrillions of supply. Today, one of the popular cryptocurrencies of 2022 has significantly reduced its supply. As a result, its price has increased considerably.
Why Did VGX Coin Rise?
Bankrupt crypto lending firm Voyager has come into the spotlight again today after burning approximately one-third of its supply. The price of VGX token has increased by 18% after the token burning process. The address used for burning approximately 83 million tokens in two transactions.
Miguel Morel, the CEO of Arkham Intelligence, stated that this move was intentional.
“They first sent a test transaction to the burning address. Then, two minutes after it was confirmed, they sent the rest. In the other address, they first sent ETH for gas, and 8 minutes later, the remaining tokens were transferred to the burning address. That’s why it seems intentional. The motivation behind it is currently unknown.”
The Future of VGX Coin
On July 6, 2022, the crypto lending firm that filed for bankruptcy entered an irreversible path. The company and senior executives were banned from operating in this field. Moreover, there was a demand for the destruction of the tokens they held. This recent demand may have been implemented today, and that’s why the tokens were transferred to the burning address.
So, while the platform has gone bankrupt, the executives have been penalized, and the team has started burning their tokens, how can VGX Coin perform? If a miracle happens and Voyager starts operating with a new brand, and VGX Coin is redefined as a local cryptocurrency, it could be a story of redemption.
However, this is the most optimistic scenario and the likelihood of it happening is very low. So why do people buy or hold VGX Coin? It’s hard to understand because even though it was said that FTT Token will be useless (FTX Bankruptcy Committee Comment), there are still those who invest in the token of a bankrupt company. Or LUNA Coin, whose founder is in prison, continues to find buyers.
Perhaps a group of investors has been holding onto VGX Coin for a long time with the expectation of speculative price movements?
