Whether you're holding, using or investing cryptocurrencies on an everyday basis, the price of each crypto unit signifies not only your performance as a trader, custodian, or consumer but also has an effect on your pockets.

If you're already experienced with at least one cryptocurrency, you must be aware of the fact that the price per crypto unit is hugely dependent on the maximum supply of the respective coin.

For example, most cryptocurrency enthusiasts are aware of the fact Bitcoin has a maximum supply of approximately 21 million BTC units, and while we all know the popular flagship crypto's supply is fixed to that number and no more than that units could be ever produced, there are several mechanisms that allow other cryptocurrencies to increase their total token supply, as happens with growing stablecoins.

Inversely, the total supply of certain cryptocurrencies can also be reduced for technical, marketing, and investment reasons. The process of decreasing a token's maximum supply is often referred to as "burning".

Here are some of the most important cryptocurrencies that utilize coin burning, along with the reasons why these projects implement this strategy.

1. Maker (MKR)

If you're familiar with the blockchain scene, it should be no surprise that Maker makes it into this list at the very top.

Then again, if you have never heard about Maker before this article, here's a quick explanation: Maker is an Ethereum-based smart contract system that is responsible for DAI, the first decentralized stablecoin pegged to the USD. DAI is backed by Ethereum instead of fiat through a dynamic system of Collateralized Debt Positions (CDPs), autonomous feedback mechanisms, and "appropriately incentivized" external users.

In opposition to USDT, for example, where fiat currency is held by the Tether company as collateral, anyone can act as the provider of collateral for DAI.

Now, it might sound like a pretty neat project already, but there's more to it. In order to generate DAI, crypto users have to lock up their ETH into the Maker platform. There are naturally some fees associated with the process, which vary depending on the market conditions (demand/supply of DAI) and have so far ranged between 0.5% and 11,5% with an average of 2,5%.

MKR is burned when Maker protocol users close their collateralized debt positions. This mechanism is intended to have a positive effect on the value of MKR, as the token becomes more scarce as its maximum supply drops. Otherwise, MKR is used as a governance token, allowing users to have their say in how the Maker platform is operated.

2. Binance Coin (BNB)

Being one of the first utility tokens that met near-instant adoption, Binance Coin is a token issued by the Binance cryptocurrency exchange. BNB is now also the native asset of the Binance Chain blockchain platform, but it still retains its original use-case of granting reduced trading fees to traders on Binance.

While it took a moment for the mainstream crypto community to realize how revolutionary BNB was at the time of its introduction, BNB skyrocketed from $0.09 to nearly $40 in just a few short years, making it one of the most successful cryptocurrencies in history in terms of ROI.

Of course, BNB's success cannot solely be attributed to its popularity as a way to reduce trading fees, but also to its burning mechanism, which didn't make much sense to some of the early BNB adopters. However, the significant difference in the price shift in the remaining tokens after the first BNB burn, it became a crypto to watch for the broader community and not just for traders utilizing the Binance platform.

In Binance's case, the token burns happened on a quarterly basis as planned by the centralized authority behind the project, with the most recent occurring this October, where nearly 2 million BNB vanished from the available supply.

From Binance's perspective, the token burn happens clearly for strategic purposes, aiming to compensate initial investors and supporters of the project, who are still sitting on a 9,000% ROI despite the general crypto market downtrend.

You can learn more about BNB and similar utility tokens in analogous cryptocurrency exchange markets here.

3. Kyber Network (KNC)

Kyber Network is a liquidity broker/platform that funds itself from a variety of decentralized crypto reserves. Basically, it enables instant ERC-20 token swaps.

The project works with decentralized exchanges, DeFi protocols and wallets to provide its services, and it manages to do so for a small fee that can be paid with KNC. It should be obvious already that KNC is Kyber Network's native token.

Considering the previous models, KNC utilizes a mechanism that lies somewhere between the DAI and BNB burn architectures. Every time a token swap is performed through Kyber Network and fees are paid in KNC, some of that KNC is instantly and automatically burned while a portion is left as profit to cover the network's expenses.