Uniswap Founder Burns 99% of HayCoin Supply Amid Price Speculation Concerns
Summary:
Hayden Adams, the founder of Uniswap, has destroyed 99% of the HayCoin (HAY) supply because of concerns about price speculation. The tokens, worth about $650 billion, were removed permanently from circulation, leading to an increase in their price. The move has raised questions about potential tax implications and suggestions that Adams could have sold the tokens and donated the proceeds.
According to a post on X (the new name for Twitter), Hayden Adams, the founder of Uniswap, has destroyed 99% of the HayCoin (HAY) stockpile on October 20. This is credited to Adam's apprehension about price speculation that has been observed in recent days.
Five years before the decentralized Uniswap protocol was initiated, Adams tested and launched the HAY coin. He established a small test liquidity reservoir with a micro part of the total amount and held on to over 99.9% of HAY coins in his inventory. A few weeks back, the token was behaving like a novelty coin, trading in the six-figure range.
Adams stated in his post that HAY tokens worth about $650 billion had been destroyed. He labeled the price speculation as imprudent and stated his discomfort at his image being affiliated with the token. He said he was troubled by having nearly the entire supply (approximately 99.99%) of a token that was being used as a joke or speculated upon, so he decided to get rid of the total amount in his possession.
When a token gets destroyed, it is permanently taken out of circulation. However, this could intensify inflationary impact on the price as it reduces the number of available units. Currently, the HAY token is trading for $2,392,640, an increase of more than 235% in the past 24 hours, as per CoinGecko.
Some users on X raised concerns about Adam's move. Apart from the impact on the HAY price, some users noted that the token incineration could potentially be considered a taxable event. One user wrote, "Assuming a cost basis of $0, a ~$650 billion disposal could invite ~$128 billion long-term capital gains liability." Some suggested that Adams could have sold the tokens prior to destroying them, then donated the earnings.
Published At
10/21/2023 4:50:53 PM
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