Synereo, the startup behind its namesake decentralized blockchain-based social network has burnt half its holdings of pre-mined AMPs, its native token cryptocurrency.
Half of all existing AMPs have been destroyed by Tel-Aviv based blockchain startup Synereo in a move to relinquish its control of over half of the blockchain’s native currency.
An aggregated amount of 731,108,937 AMPs were destroyed on Saturday, September 17th. They were held in several cryptographic wallets controlled by Synereo. A majority of those destroyed – nearly 400 million AMPs – belonged to the the company’s Future Funding Wallet which provides funds for future phases of the project.
Synereo founder and CEO Dor Konforty revealed the company’s original outlook was contingent on selling more AMPs than they did, as well as distributing the token sooner to its users.
In addressing the subject of centralization firmly to bed, he wrote in a blog post:
[I]t was never our intention to be the central bank for our information flow currency. Such centralization goes against the very principles Synereo stands for.
Noting that it wasn’t enough to merely stand for those principles, Konforty added:
That is why we have decided to burn about half of all AMPs held in Synereo’s wallets… effectively destroying over $140 million worth of the cryptocurrency based on recent market prices.
Synereo will adopt and develop proof-of-stake (Ps) blockchain, Konforty revealed. Since a PoS ledger is open to manipulation by its majority holder, he added:
[I]t will not make sense for Synereo to hold more than 50% of all coins.
The founder insists that Synereo’s blockchain, scheduled for release on the mainnet in 2017, will see the company hold fewer than 50% of all AMPs aggregated among the different wallets it controls. It aims to do so by distributing the necessary AMPs for their intended purposes before burning all of the remaining tokens at the time of release.
Furthermore, “many of the AMPs Synereo holds” will be distributed among new users joining the network; bounties for musicians and content creators and; grants for dApp developers.
“This project will not help anyone if Synereo maintains an entrenched, centralized position,” Konforty wrote. “That is why we want to distributed AMPS as soon as we can, to begin establishing a truly decentralized economy.”
The company will also start its second fundraising round today, as a party of its multi-phase fundraising strategy. Pre-mined AMPs will be sold during the fundraising campaign.
Images from iStock/Stolk and Synereo.