# Daily Burn (Demurrage) {% embed url="" %} In Circles-enabled apps (for example, the [Gnosis app](https://app.gnosis.io/)), you can spot CRC burn events in your Activity feed. These appear regularly and reduce your displayed CRC balance over time. *** ### What is Daily Burn? Daily Burn is Circles’ built-in demurrage: a small, automatic reduction of the CRC balance you hold. * Roughly \~0.02% of your current balance per day is removed (“burned”). * Over a year, that adds up to 7% annual demurrage. * This is not a fee and is not paid to anyone—the burned CRC simply cease to exist. ### Why Circles has Daily Burn? Daily Burn is one half of Circles’ monetary design: 1. Creation force: each user can create 1 CRC per hour. 2. Destruction force: existing CRC depreciate at 7% per year via demurrage. {% hint style="info" %} The Circles whitepaper explains that these two forces are tuned to support intergenerational fairness so the system stays attractive to new joiners even decades later. {% endhint %} #### The “fair access” idea Circles aims for a property like: * People who join later shouldn’t be permanently “too late.” * Over long time horizons, the gap between early joiners and new joiners shrinks, because early-created money gradually loses weight relative to ongoing creation. ### What does “demurrage” mean? “Demurrage” is a monetary concept often associated with the economist [Silvio Gesell](https://en.wikipedia.org/wiki/Silvio_Gesell), historically discussed as a way to discourage hoarding and encourage circulation (sometimes via “stamp scrip” systems). Circles uses demurrage a bit differently: it’s paired with universal, ongoing issuance (everyone creates), which changes the goal from “just circulation” to a blend that supports long-term fairness and accessibility. ### What Daily Burn implies for you? * Holding CRC long-term has a carrying cost (like a gentle “melting”). * Spending/using CRC sooner avoids some future burn (because you’re not holding it as long). * Burn is automatic and time based, you don’t need to claim, approve, or trigger it. ### How the “maximum created” amount works? Over a lifetime-scale horizon, demurrage plus 1 CRC/hour issuance creates a saturation effect: * The [Circles whitepaper](https://whitepaper.aboutcircles.com/) notes that accounts approximately reach a maximum level of \~120,804 CRC after creating for about 80 years (life-expectancy scale). * After creation stops, the remaining nominal amount trends downward with an exponential “half-life” on the order of \~10 years. {% hint style="info" %} Important nuance: this “maximum” framing is about what you can create in your own name over time, not a hard cap on what you can hold (you can still hold more via transfers). {% endhint %} *** ### FAQ #### Is Daily Burn the same as a transaction fee? No. It’s not paid to validators, app developers, or any treasury. It’s a protocol-level removal of value from existing balances. #### Does burn apply to “my CRC” only or all CRC I hold? It applies to the CRC balance you hold (regardless of whose CRC they originated from), because it’s defined as depreciation of existing CRC holdings. --- # Agent Instructions: Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter: ``` GET https://docs.aboutcircles.com/user-guides/circles-features/daily-burn-demurrage.md?ask= ``` The question should be specific, self-contained, and written in natural language. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.