Cryptocurrency exchange Bitfinex has announced a transparency initiative that will see it put on full view the buying back and "burning" of its LEO exchange token.
In an announcement Friday, the firm said as part of its token redemption process, the UNUS SED LEO Transparency Initiative will allow the public to see parent firm iFinex use its gross revenues to purchase circulating LEO tokens at market rates. These will then be destroyed, or burned, as the firm effectively pays back those who bought the exchange token in a $1 billion sale early last month.
The redemption mechanism went live at 10.00 UTC Friday. The firm said tokens will be burned "every 3 hours until 100% of supply has been taken out of circulation."
As the LEO buyback progresses, Bitfinex said it will provide the public with "real-time insights into all collected platform fees, and subsequent LEO burns" via a dedicated dashboard.
The firm further explained:
The first phase of the burn mechanism only includes revenue from trading fees. However, the exchange said it plans in coming weeks to include "all revenue streams."
In response to the New York attorney general's claim the company had lost the $850 million, Bitfinex responded that the funds had in fact been locked up on a payments platform called Crypto Capital.
In today's announcement, the firm said any funds recovered from Crypto Capital would be used to buy and burn LEO tokens, as would an amount worth "at least 80% of recovered net funds" from its 2016 hack of cryptos worth $80 million at the time.
Burning match image via Shutterstock
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