The Stellar Development Foundation (SDF) has burned over half of its total token supply of Lumens (XLM), sending prices soaring more than 26 percent in less than an hour.

Speaking at Stellar’s inaugural Meridian conference in Mexico City on Monday, SDF Executive Director and CEO Danelle Dixon announced the XLM token burn.

“The network and the community around Stellar are different than they were when we first started,” Dixon said.

“They’re much more robust and SDF can carry less weight now because of where the network is.

“We’re just a piece of a much larger whole and the funds that we use that we have need to reflect that.”

Prior to the burn, Stellar’s total token supply stood at 105 billion XLM. Of that supply, 20 billion tokens are publicly held, while 17 billion were reserved for SDF’s operating fund and 68 billion for giveaway programs.

According to Dixon, 5 billion XLM from the operating fund and 50 billion XLM from the giveaway programs were burned, reducing the total token supply to just 50 billion lumens.

“We believe that the number of Lumens now better aligns with our mission. […] This new mandate reflects our desire to do more of what has worked at SDF and for Stellar and less of what hasn’t worked,” she added.

Burn ignites XLM price spike

The effect of Dixon’s announcement on the Stellar Lumens market was felt almost instantly.

As news of the token burn quickly began to spread, the price of Lumens rose dramatically. In less than an hour, XLM prices soared from $0.0698899 to $0.0882478 – an increase of more than 26 percent.

The price of XLM has cooled a bit since then, dropping roughly 7 percent since Monday’s high.

At the time of writing, XLM is currently trading at $0.0819871.

What’s next for Stellar?

Now that it has burned 55 billion XLM, what’s next for the SDF? Of the remaining 50 billion Lumens, just under 30 billion are still administered by the foundation and will be reallocated to four core areas – direct development, ecosystem support, user acquisition, and use-case development.

A blog post published on the SDF website details each of those four areas and underscores the foundation’s commitment to progress and transparency.

“We’re extremely excited about this renewed focus for SDF and also about the transparency we will bring to these efforts.

“Each allocation will be set aside in its own account before the end of the year, and we’ll publish the addresses, so the Stellar community can track our progress and see our commitment to this plan.”