What is TRON (TRX)? Is it a good investment? (2022)
If you are a fan of science fiction, you have probably heard of the classic movie Tron from 1982. However, what you may not know is that it is also the name of the TRON (TRX) platform that hosts one of the fastest growing cryptocurrencies. Current growth.
TRON is a blockchain platform whose objective is to share user content in a free and decentralized way. Incorporated in 2017, its native cryptocurrency, tronix (TRX), currently ranks as the 20th largest cryptocurrency by market capitalization.
Justin Sun, the CEO of the TRON Foundation, founded the platform with the idea of providing a place where content could be shared for free without middlemen taking a cut of the profits.
Let's take Netflix, for example. Content producers must pay to host content on this platform. In the end, only a small percentage of the commissions they receive through subscribers actually go to the content producers themselves.
Although creators can host content on YouTube for free, the user data the platform collects is likely to be used for company monetization. But TRON was set to revolutionize this concept. In fact, with the help of blockchain technology, users can reward content providers directly; similar to how they do it on Patreon. Not only that,
TRON refuses anything related to community standards and censorship of content posted on YouTube or similar platforms.
TRON aims to “cure the internet” by freeing up data for its users, who can control their data and get rewards directly from what they produce. This does not only apply to YouTube-style user-generated content, but extends to different types of decentralized applications ( dApps) built on the TRON blockchain.
These include games, decentralized finance (decentralized finance or DeFi), and even a shared bike dApp. The main thing about all this is that it is an open and decentralized network in which there are no middlemen who benefit from the profits of the content creators. TRON raises a «Web 3.0»; an internet where there are no intermediaries and the creators of the dApps are the absolute owners of what they produce.
TRON bills itself as the "world's fastest growing public chain." It uses peer-to-peer (P2P) technology and a delegated proof of stake (DPoS) consensus mechanism. It differs from Ethereum in that
Ethereum 2.0 went from Proof of Work ( PoW) to Proof of Stake ( PoS).
How is TRX used in the network?
TRX can be used for different purposes:
• For the payment of content that users want to access, which is received directly by the content creators. To reward participants for what they do on the hundreds of dApps hosted on the TRON blockchain and to purchase other cryptocurrencies or pay for services on the blockchain.
• Although this use is not as widespread yet, it can also be used to pay for everyday products and services.
• Also, it can serve as a store of value for an investment, just like bitcoin and other cryptocurrencies. In January 2021, its price was around the $0.03 mark. Later in this article, we will continue to analyze the price history of TRX and see whether or not it is a good investment.
• TRON users can lock their tokens for a while to gain power on the network. That essentially provides users with the right to vote on the decisions that are made on the network. Although users cannot use the tokens while they are locked, it is a guarantee that they will not be used by anyone else either.
TRON was created in 2017 by CEO Justin Sun and his Singapore-based organization, the TRON Foundation. It started on the Ethereum blockchain before migrating to its mainnet in 2018. In July of that year, the company acquired BitTorrent, the file-sharing service, and brought it into the TRON ecosystem.
In early 2019, the TRC20-USDT on the TRON blockchain in association with Tether.
In October 2019, they announced a partnership with Samsung, the South Korean electronics giant. Thanks to this partnership, the blockchain wallets built into Samsung Galaxy S10 phones now support TRX.
Although the year 2020 seems to have been inauspicious for many industries, it was actually a year in which TRON broke many records. In April, a TRON section was added to the Samsung app store. In May, the world's largest P2P storage network was launched - BitTorrent live. In August, TRON's decentralized exchange (digital financial service) called JustSwap was launched, allowing instant exchange of TRC-20 tokens between traders.
By the end of 2020, there were more than 1,400 TRON dApps with an average of approximately 10,000 active daily users.
At the end of 2020, it was reported that the transaction volume of dApps on the TRON blockchain even surpassed that of Ethereum (quite a feat). This comes after a wave of transactions whose volume reached more than 80% between September and October 2020.
Like many other cryptocurrencies, TRX price exploded during the famous cryptocurrency bull run in late 2017 and early 2018. It started at $0.001091 in September 2017 and reached an all-time high of $0.30 in January 2018. As of winter of 2018, it has been oscillating between $0.02 and $0.04, but has not broken above $0.05. For potential investors, the fact that TRX has not risen back even close to its all-time high, despite so many TRON associations, could be concerning.
However, if we compare the price of TRX in January 2020 (close to $0.01) and January 2021 (close to $0.03), a price increase of around 300% is observed. That's an even higher return on investment than many cryptocurrencies over the same period.
What is the future of TRX?
Much of the popularity of TRX and the TRON platform is due to the DeFi boom that exploded onto the cryptocurrency scene in 2020 and is poised to continue to take over, at least to some extent, in 2021. The Justlend platform, hosted on the TRON blockchain, it has proven to be very popular. It is TRON's first DeFi lending venture. This allows users to borrow TRX tokens and earn passive income from the accrued interest.
Whether TRON can come to dominate the DeFi space remains to be seen, but one thing is for sure: gas-free transaction fees have attracted many users. In contrast, on Ethereum, the demand for transactions prior to Ethereum 2.0 caused transaction fees to skyrocket to $60.
However, TRON has also received unfavorable opinions from some critics in the DeFi field. Twitter users stated that TRON is actually centralized in nature, while others accused it of hanging onto the success of DeFi.
The expression “killer of Ethereum” has become a cliché of late. However, and despite being the ultimate goal of any platform based on dApps, it is still too early to know if this will finally be the case for TRON.
Our verdict is very bullish when it comes to TRON as a long-term investment. Its growing portfolio of partners has built trust in the platform, and the recent announcement about collaboration with one of the Chinese government agencies provides a very positive outlook. He is not an “Ethereum killer”, and probably never will be, but never mind. Its goal of providing a platform for decentralized sharing of user content is a unique selling point for developers and is enough to make it a success in and of itself.
