Tech
TRON (TRX) Blockchain Platform Explained.
What is Tron?
Tron is a blockchain to create decentralized applications. Its native token is TRX, which developers can use in their applications. Unlike similar blockchain projects, TRX is not used on-chain to pay transaction fees.
Tron is operated by Tron DAO, a Singapore-based non-profit organization.
Key points
- Tron is a blockchain-based digital platform that seeks to become a distributed virtual machine for decentralized application development.
- Tron is supported by a non-profit foundation, the Tron Decentralized Autonomous Organization.
- The native token of the Tron blockchain is TRX.
History of Tron
The Tron Foundation was founded by Justin Sun in 2017 with the goal of creating a scalable blockchain and virtual machine that would allow content creators to share and monetize their content.
It was hoped that this design would appeal to content creators, who would retain full ownership of their content by removing intermediary streaming services. Creators would receive payment from consumers, who would pay for the content using TRX.
In 2018, the Tron Foundation purchased BitTorrent, a peer-to-peer file sharing system. The purpose of this purchase was to use the existing system to facilitate faster downloads and uploads of content.
The content creation and sharing model did not attract the following its designer hoped for, so the blockchain was redesigned for decentralized application development. The foundation and blockchain were fully decentralized in 2021 and handed over to the community. The foundation became Tron DAO (decentralized autonomous organization), governed by its users using smart contracts.
The goal of Tron DAO is to become the blockchain and platform used by developers to create Web 3, the supposed next iteration of the infrastructure behind the Internet and the World Wide Web.
How Tron works
Tron’s blockchain and network were compared to those of Ethereum Platform, but it works a little differently. The Ethereum blockchain uses its native cryptocurrency, ether, as a payment method for network participants called validators.
Tron uses bandwidth points as payments. By default, each user has 600 points of bandwidth, which represents 600 bytes of data. Transactions are measured by the number of bytes they take up in a block, so if a transaction is larger than the amount allowed by default, the user must purchase more bandwidth points. You can acquire more bandwidth points by staking on TRX.
Tron uses staking in a consensus protocol called Delegation Proof of Stake. Stakers receive rewards for submitting to the checkpoint for sending a snapshot of the state of the blockchain in addition to paying transaction fees. Furthermore, the staked amount gives them more voting power in governance activities, such as voting for the 27 super representatives. Super representatives are nodes that propose blocks for the blockchain, so it doesn’t exist”extraction” or competitive puzzle solving for tokens.
These nodes also distribute rewards to super representative partners or unelected candidates among the 27 super representatives by setting a “broker ratio” in their wallet. The broker ratio is the ratio of premiums retained by the super rep to premiums distributed to partners. Super Representatives are not required to distribute rewards, but their intermediary relationship helps them receive votes during elections.
How to get Tron
Tron can be purchased on many exchanges that support it, but it is not available on Binance.US, Gemini or Coinbase. TRX is not mineable like many cryptocurrencies; must be earned by staking TRX you already own.
Many people are willing to sell their TRX peer-to-peer (you can find many instructions on how to do this online), but this method is very risky. There are many scammers who will try to sell you TRX for another cryptocurrency or will try to rent bandwidth to you so you can make a transaction. They may accept other cryptocurrencies or tell you that they accept fiat currency through PayPal or other services. It’s easy to be tempted by some of these seemingly helpful community members, but P2P in this context isn’t safe. You are more than likely to become a victim of a scam using these methods, so it is best to use a regulated exchange.
The future of Tron
It is always difficult to predict whether a cryptocurrency and blockchain will exist in the future. Like many blockchains, Tron has been entrusted to a non-profit decentralized autonomous organization (DAO), Tron DAO. The organization appears to be active in and sponsoring an event called HackaTron, where blockchain developers can compete to create decentralized applications.
Since the end of 2022, the market price of TRX has seen a slow progressive rise. It had a market capitalization of $10.2 billion and a 24-hour trading volume of 324.1 million, suggesting that there is a significant amount of capital invested in TRX but relatively low liquidity.
In May 2024, Tron DAO announced that Google Cloud had joined its list of “super representatives”, reliable network nodes that offer new blocks for the blockchain. These representatives are voted by the network after paying 9,999 TRX to become candidates.
There appears to be an active, albeit small, community, a supportive and involved DAO, and investor interest. There is a good chance that TRX and Tron will maintain their position as long as there is interest in keeping the project alive.
Does the TRON cryptocurrency have a future?
Predicting what the future holds for TRX and Tron DAO is difficult. However, the project still appears to be attractive to some users and investors, so it may have some staying power.
Is TRON Coin a good buy?
The Tron blockchain’s native token, TRX, has a market capitalization of tens of billions and a trading volume of hundreds of millions of dollars per day. Its market value has been slowly increasing since 2022. Whether it is a good buy depends on your market outlook, preferences and risk tolerance, so it is best to talk to a financial advisor experienced in cryptocurrency before investing.
How much will Tron be worth in 10 years?
It is difficult to predict what will happen to the price of a cryptocurrency because the market is very volatile and susceptible to many influences
The bottom line
Tron is a blockchain created to host decentralized applications. Its native token, TRX, is used as a reward, to make payments, and as a speculative tool for investors.
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