Token burn
In short A token burn permanently removes tokens from circulation, usually by sending them to an address nobody can spend from, reducing supply.
A token burn is the permanent destruction of tokens. Once burned, they can never be spent or traded again, so the total or circulating supply goes down. Projects burn tokens to reduce supply, to show they will not use certain holdings, or as part of an ongoing mechanism built into the protocol.
There are two common methods. One is sending tokens to a dead address, such as the zero address or one ending in many zeros and dead, for which no private key is known. The other is calling a burn function in the token contract, which deletes the tokens and lowers the recorded total supply. Some protocols burn automatically: Ethereum has burned part of every transaction fee since the EIP-1559 upgrade in 2021, and some tokens burn a slice of each transfer or use revenue to buy back and burn. Burning LP tokens is different: it permanently locks a liquidity pool rather than reducing the token's supply.
For holders, a burn only helps if it changes the real balance between supply and demand. Burning tokens the team already held and never planned to sell does little for the circulating supply. Announced burns are also a favorite marketing tool, sometimes timed to create hype while insiders sell.
Check burns in a block explorer instead of trusting announcements. Confirm the tokens went to a dead address or were destroyed through a burn function, and see whether they came from circulating supply or from a team reserve. Watch for contracts that can mint new tokens, since a burn means little if the owner can create more at will.