There is no doubt that TRON is one of today’s largest blockchain project around the globe. Established in September 2017, the project mainly aims to create the infrastructure of a decentralized entertainment ecosystem. According to its whitepaper, TRON platform is needed particularly in the entertainment industry due to 2 major reasons; first the user credit and user information, and second, the transfer of value.
Thus, the protocol under TRON is trying to solve scalability problems in order to provide a more affordable platform for Dapps. Obviously, this seems very optimistic since the digital entertainment market is estimated at about $1trillion and is expected to grow exponentially over the next few years.
TRON the enemy of entertainment middleman:
The main values of TRON are heavily influenced by the principles of Sir Timothy Berners Lee, the creator of the world wide web. For instance, according to him, the internet should serve people and not be used for maximizing profits for corporations. Today, this seems obvious! For example, Youtube is a centralized video hosting platform that makes revenue from ads, which is unequally split in favor of the company, not the creators. The same goes for different major companies.
As a solution, TRON offers a medium for creators in order to share their content with customers directly, cutting out the middlemen. All the data shared is cryptographically secured through the blockchain technology. In this new model, the creators retain all of their profits instead of other companies taking a cut. Furthermore, TRON will be also protecting the privacy of its users.
TRON has a specific roadmap of 6 different stages. The first four phases are set to end by 2023, and the last two phases by 2027. Here they are:
- Exodus: The free platform for peer to peer distribution, storage, and content.
- Odyssey: Economic incentives put in place to encourage content creation and empowerment
- Great Voyage: Individual ICO capabilities
- Apollo: Ability for content producers to issue personal tokens
- Star Trek: Creating a decentralized online gaming platform, monetizing traffic
- Eternity: Developers can create their games on the TRON network; crowdfunding for the games is also made possible via the TRON network
TRON claims that in order to achieve high-speed data processing, the compromise of the degree of decentralization must be made. Consequently, TRON developed a consensus catered to the needs of its network on the basis of the delegate proof of stake(DPoS). The project claims that DPoS is today considered one of the most stable mechanism. The number of the representatives on TRON is 27 that goes under the name of “Super Representatives”, which are block producers on this blockchain. They are the bookkeepers on the network. Basically, their key role in governing the TRON community by ensuring basic functions, e.g. block generation and bookkeeping and obtain corresponding earnings.
In terms of choosing the representatives, TRON’s DPoS Mechanism uses elections. During the elections, holders of “TRX” are able to stake (freeze) their “TRX” to convert it to “TRON Power” which can be unfrozen back after three days to be back “TRX”. Every 6 hours a new cycle of voting data is collected and representatives not doing their job can lose Super Representative status.
Even with the presence of 27 super representatives on the blockchain, TRON Foundation and TRON community still have the responsibility of co-governance by the TRON community and the TRON Foundation. For instance, the foundation is providing technical support to TRON’s network.
“The love story” to create the larger decentralized network
After dozens of rumors that surfaced around the interest of Justin Sun in purchasing the peer-to-peer file sharing platform for months BitTorrent, everything was confirmed by 23 July 2018. A press release was published confirming that and one of the biggest deals of 2018 was made: $140 Million!
As a consequence of this acquisition, BitTorrent had lately launched a native token, BitTorrent (BTT), based on the TRON Protocol just after less than 6 months of the deal. This new token can be exchanged between users with a goal to optimize their network speed and attain faster speed. From a technical side, BTT tokens will be issued by the BitTorrent Foundation, feature native TRC-10 compatibility which means that they adhere to a technical token standard supported by the TRON blockchain.
Obviously, BTT is part of a TRON’s broader ambition to create a decentralized content distribution platform using cryptocurrency. Eventually, this will lead to creating the largest blockchain ecosystem thanks to the impressive user base (more than 100 Million active users) which will lead, after all, to mass adoption of TRON.
Back to the old days
Until today, TRONS ICO was one of the largest ICOs in history. The sale of the TRX token happened between 31st August to 2nd September 2017.
Here is a quick summary of the ICO:
TOKEN TYPE: ERC20
ICO PRICE: 1TRX= 0.00186USD(0.000000038BTC)
FUNDRAISING TARGET 10,000,000USD.
TOTAL TOKEN: 100,000,000,000.
AVAILABLE FOR TOKEN SALE: 40% of Total Supply
As you can see, the token type at that time was ERC-20. Obviously, it was created on the Ethereum blockchain. At first, it was a strategy to make it easy for wallets since they did not handle each token differently. In order to create a native coin for the Tron Mainnet, TRON gave birth to the TRC20 tokens, which is an equivalent of ERC20 on Tron’s main net. Users were obliged to migrate from the ERC20 to the TRON20 standard. The swap was 1:1, meaning that it did not impact any TRON supporter’s balance.
Just after the Mainnet launch that took place on 25th June, the Tron Foundation initiated the coin burn process. They claim that the coin burn is considered as the final step of Tron’s migration from the Ethereum blockchain.
During the 1st batch of coin burn, the Foundation burnt 1 billion TRX ERC20 tokens worth $50 million approximately, which can be considered as the largest destruction of money in human history. Due to their 100 billion total supply of tokens, TRON found themselves in a sort of a problematic situation. On the first hand, high supply coins provide larger market liquidity that leads to benefit both exchange speculators and coin’s users, in addition to, the low price per coin that has a psychological effect on a new buyer’s standpoint in comparison to the huge price of Bitcoin. On the other hand, the high coin supply does not give the feeling of scarcity that has arguably driven the price of Bitcoin and Ethereum so high during 2017. As a consequence, the main goal behind coin burn is making the coins in circulation under control that leads to increasing prices. The Tron Foundation also stated that the coin burn would encourage fair distribution of the cryptocurrency.
Advantages of Tron
Data Liberation: A strong factor in Tron’s “big idea” and a major reason for its appeal is that the platform is enabling its users to have the fundamental ownership of their data and created content.
Transaction Rate: With estimated 10,000 transactions per second (TPS), Tron is potentially superior to Ethereum in terms of transaction rate (25 TPS).
Ultra-low Transaction Fees: The transaction fee is almost zero. It’s around 0.000005 cents per transaction.
Popularity: There is a lot of talk about Tron in the blockchain ecosystem, mainly due to the buzz created by its founder, Justin Sun, who is also a Jack Ma protege. In addition, it’s listed on many exchanges and has gained a lot of users in a very short period of time after its launch.
Personal ICO: Tron allows its users to start their own ICO’s by giving away digital assets individually, which helps in increasing the rate of rising in funds.
Mass adoption: TRON is working toward mass adoption by partnering and acquiring other startups. The best example is the acquisition of BitTorrent.
Funding: Tron has a strong list of solid investors. Around $1 billion USD is spent on developer rewards and community support.
Disadvantages of Tron
Uncertainty: Tron’s future seems sometimes uncertain if we consider its news. Many examples can highlight this: the swap of ERC20 to TRC20, burning coins…
Compared to other cryptocurrencies present, TRX has a huge circulation and total supply. Eventually, this can be affecting its monetary value.
Time: Compared to today’s fast-evolving industry, the long-planned roadmap of TRON is risky since it covers more than 8 years.
Plagiarism: In addition to its white paper that was widely accused of plagiarizing Filecoin and IFPS whitepapers, TRON was also accused of copying/stealing code from other blockchain projects.
Low Number of Dapp: According to Dapp Radar (when writing the article), there are 194 deployed TRON DApps compared to 346 for EOS and 1,418 for Ethereum.
Centralized: Many faces of the blockchain ecosystem, including Vitalik Buterin, claims that due to the tiny number of nodes it can be sort of centralized. On February of this year, Vitalik stated in an event: “When a blockchain project claims ‘We can do 3,500 TPS because we have a different algorithm,’ what we really mean is ‘We are a centralized pile of trash because we only have 7 nodes running the entire thing.”
Investing in TRX:
Sorry! this not the place where people speculate. We are focusing on writing about the blockchain technology behind every project ‘objectively’, not on writing about “how to get rich quickly”.
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