Flare Network Announces Massive Burning of FLR to Improve Ecosystem Health
Flare, an EVM-based blockchain designed for building data-centric applications, announced that it will burn 2.1 billion of its native FLR tokens to enhance its ecosystem health. The move will see the network burn more than 2% of all FLR and they will be permanently taken out of circulation. The 2.1 billion tokens that will be burned represent over 40% of the total token supply.
FIP.01 and the impact of the burn
By burning FLR tokens, Flare aims to mitigate the risk of token inflation and incentivize more people to join the network. In the absence of this, Flare says its investors would be able to claim about three times their initial allocation via FlareDrops. Ultimately, this would skew the token distribution unfairly to the advantage of initial backers, and to the detriment of the community.
However, this is not entirely surprising, given that early supporters of the project received the tokens that were meant to be burned. This is the result of Flare’s agreement with these supporting entities on how the first Flare Improvement Proposal (FIP.01) should impact token allocations to equity shareholders.
In January, 94% of the Flare community voted to support the implementation of FIP.01, initiating the process. The goal of the proposal was to encourage more people to join the network by making token distribution more accessible to them. As a result of the latest changes, the community will see its allocation in the Flare network tokenomics rise marginally from 58.3% to 59.6%.
Furthermore, all Wrapped FLR holders will receive a total of 24.2B tokens over the course of three years. These tokens will come via 36 monthly FlareDrops , in line with the provisions of FIP.01. To date, the network has completed seven FlareDrops, with the eighth set to happen on October 13.
The FlareDrop process will end in January 2026. This will see the burning of a total of 198,880,170.19 FLR immediately and another 66,293,390.06 FLR monthly. Due to the long-term burn, backers will only receive a small percentage of their initial allotment. Earlier in the week, the backers received the remaining tokens.