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TRON (TRX) Blockchain Platform Explained
What is Tron?
Tron is a Blockchain to build 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 non-profit organization in Singapore.
Key points
- Tron is a blockchain-based digital platform that aims to become a distributed virtual machine for developing decentralized applications.
- 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 through TRX.
In 2018, the Tron Foundation purchased BitTorrent, a peer-to-peer file sharing system. The intent 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 had hoped for, so the blockchain was redesigned for the development of decentralized applications. The foundation and blockchain were fully decentralized in 2021 and handed over to the community. The foundation became the Tron DAO (decentralized autonomous organization), governed by its users via smart contracts.
Tron DAO’s goal is to become the blockchain and platform that developers will use to build Web 3, the rumored next iteration of the infrastructure that underpins the Internet and the World Wide Web.
How Tron Works
Tron’s blockchain and network were compared to those of Ethereum Platformbut 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 bandwidth points, which represent 600 bytes of data. Transactions are measured by how many bytes they take up in a block, so if a transaction is larger than the default amount, the user must purchase more bandwidth points. More bandwidth points can be acquired by staking TRX.
Tron uses staking in a consensus protocol called Delegated Proof of Stake. Stakers receive rewards for sending checkpoints for sending a snapshot of the blockchain state, as well as receiving transaction fees. Additionally, the amount they stake 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 there is no “extraction” or competitive puzzle solving to earn tokens.
These nodes also distribute rewards to super rep partners or non-elected candidates for being among the 27 super reps by setting a “broker ratio” in their wallet. The broker ratio is the ratio of rewards retained by the super rep to the rewards distributed to partners. Super reps are not required to distribute rewards, but their broker ratio 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; it must be earned by staking TRX that 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 try to rent you bandwidth 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 is easy to be tempted by some of these seemingly helpful community members, but P2P in this context is not safe. You are more than likely to become a victim of scams 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 handed over to a non-profit decentralized autonomous organization (DAO), Tron DAO. The organization appears to be active, sponsoring an event it calls HackaTron, where blockchain developers can compete to create decentralized applications.
Since late 2022, TRX’s market price has been on a slow and steady rise. It had a market cap 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 roster of “super representatives,” trusted 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, if small, community, a supportive and engaged DAO, and investor interest. There is a good chance that TRX and Tron will hold their ground as long as there is interest in keeping the project alive.
Does TRON Cryptocurrency Have a Future?
It is difficult to predict what the future holds for TRX and Tron DAO. However, the project still seems attractive to some users and investors, so it may have some resistance.
Is TRON Coin a good buy?
Tron’s native blockchain token, TRX, has a market cap of tens of billions and a daily trading volume of hundreds of millions of dollars. Its market value has been slowly increasing since 2022. Whether it’s a good buy depends on your market outlook, preferences, and risk tolerance, so it’s best to talk to a financial advisor who’s familiar with 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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