Uniswap’s Founder, Hayden Adams, Destroys 99% of HayCoin (HAY) Supply Amid Price Speculation Concerns
On October 20th, Uniswap’s visionary creator, Hayden Adams, made a decisive move by incinerating a staggering 99% of the HayCoin (HAY) supply. His action was driven by mounting apprehensions about rampant price speculation. The announcement was made via an official statement on a platform yet to be disclosed.
Adams’ history with HAY dates back five years when he initially deployed the token for testing purposes before Uniswap’s decentralized protocol became a reality. Back then, he established a minuscule test liquidity pool, only tapping into a fraction of the total supply while keeping more than 99.9% of the HAY tokens tucked away in his wallet. Astonishingly, HAY had recently turned into a meme-like asset, trading at six-figure valuations.
In his own words:
“Over the years, a few people have noticed it and bought it as a joke or for its novelty. I was extremely surprised to see people buying and selling significant amounts of it over the past week, treating it like a memecoin. Crypto can be peculiar at times.”
As disclosed by Adams, roughly $650 billion worth of HAY tokens were obliterated in this move. The founder of Uniswap firmly labeled the price speculation as “absurd,” emphasizing his desire to disassociate his image from the token. He stated, “Ultimately, I’m uncomfortable owning almost the entire supply (around 99.99%) of a token that is subject to memes and rampant speculation, so I chose to destroy the entire balance in my wallet, which was ‘valued’ at an astronomical ~$650 billion.”
Token burning signifies the permanent removal of tokens from circulation, which concurrently has inflationary implications on their market value by reducing the available supply. At the time of writing, HAY was trading at $2,392,640, marking an impressive surge of over 235% within the past 24 hours, as reported by CoinGecko.
Adams’ bold maneuver sparked considerable discussion within the crypto community. Beyond its impact on HAY’s price dynamics, some raised concerns about the potential tax implications, considering token burning as a taxable event. One user estimated, “Assuming a cost basis of $0, a disposal of approximately $650 billion would result in a long-term capital gains liability of roughly $128 billion.”
Others proposed that Adams might have chosen to sell the tokens before destroying them and then donated the proceeds to a charitable cause, presenting an alternative approach to address the situation.