Cronos, the EVM-compatible Layer 1 blockchain supported by Crypto.com, has proposed to reissue 70 billion previously burned CRO tokens. This action aims to restore the total supply to 100 billion CRO and strengthen Cronos’ role in the crypto and AI landscapes.
Why Is Cronos Reissuing Burned Tokens?
In February 2021, 70 billion CRO tokens were burned, marking one of the largest burns in crypto history. This was meant to enhance scarcity and increase token value. However, Cronos now sees restoring the original supply as crucial for its long-term growth and strategic goals. The network has since seen expansion, with the integration of CRO into institutional markets and a focus on becoming a hub for AI-powered applications.
How Will the Strategic Reserve Work?
The 70 billion CRO will be placed in a custody wallet known as the Cronos Strategic Reserve, subject to stringent control mechanisms and a 10-year vesting period. The initial CRO distribution on Ethereum was locked for five years; the new tokens will undergo an additional five-year lock-up. Tokens will be released linearly on a monthly basis through the Cosmos SDK vesting account mechanism on the Cronos PoS chain.
Potential Benefits
If Cronos successfully integrates into ETFs and liquidity pools, demand for CRO could increase. More liquidity supports DeFi, staking, and AI-powered applications. This structured vesting prevents sudden token inflations, ensuring CRO remains a valuable asset over time.
Cronos aims to reinforce its role in the cryptocurrency and AI sectors by re-establishing the original CRO token supply. This move is set to aid in institutional adoption and long-term project sustainability.
