How Is HDRN Burned?

There are 2 main methods HDRN tokens are permanently burned out of existence in the Hedron Protocol.

The first method is via the HDRN that is Advanced/Borrowed and ultimately paid back resulting in both the principal and interest repayments being burned in their entirety.

The second method is via Liquidation Auctions, where users bid with HDRN on unrepaid Advances eligible for liquidation. The winning bid in any auction is ultimately burned in its entirety meaning that the more bids that are made overall and/or the larger the bids that are made after the first bid, the more HDRN that is subsequently burned.

There’s also a third way HDRN tokens can be burned: Any user has the option to manually burn HDRN via the ‘Proof of Benevolence’ function. This function is not exposed in the DApp but it will be available for any user to execute should they choose to by specifying an amount of HDRN tokens they’d like to burn permanently.