TRON (TRX)–Following the successful launch of Test Net at the end of last month, TRON is making a strong push as an industry leader in cryptocurrency–both through development and valuation. As if the launch of TRON’s official platform were not enough, the foundation behind TRX announced a 2 billion USD investment fund to catalyze TRON development and implementation, in addition to the most bizarre news to come out of cryptocurrency in some time: the gifting of 30 million TRX (1.5 million USD) to Ethereum users.
Main Net on the Horizon
The long-awaited Test Net update was a prelude to May’s Main Net launch, which will see the currency officially break free from it’s Ethereum source code. In addition to differentiating itself from the market of ERC-20 tokens, TRON is also going to establish its own platform for network usability, giving newer development teams the option to build on top of TRON’s scaffolding.
With Main Net, TRX immediately becomes a Top 5 currency in terms of usability:
- Scalability. Justin Sun first tweeted back in February that the Main Net update would enable TRON to process 1000+ transactions per second. Compared to Bitcoin and Ethereum, which process 7 and 14 tps, respectively, it’s clear that TRON has entered into a new league of utility. While the 1000+ tps is still below Ripple’s 1500, and a far cry from Visa’s 50,000+, it represents a good start for the TRON team in tackling one of crypto’s greatest hurdles: an inability to scale.
- All but free transactions. The cost of sending TRON on Main Net will be 0.00001 TRX, or less than one ten-thousandth of a penny at current prices. Put another way, a TRON user can conduct 100,000 TRX transactions (for buying, spending, participating in gaming, voting on articles, sharing photos, etc.), all for the cost of one TRON token. In no way will transaction costs become a barrier to TRON use and adoption in the way that they have crippled Bitcoin usability. Lightning Network is attempting to alleviate the damage done to Bitcoin’s brand image, particularly after this past January when average transaction fees reached above 25 USD for weeks. TRON is getting ahead of the issue of fees by making the currency essentially free to buy and sell with.
- TRX Coin Burn. There was a lot of confusion surrounding TRON’s coinburn following the announcement, and the details are still somewhat murky. Essentially, TRON’s coin burn will function differently from a currency like Ripple, which consumes 0.00001 XRP for every transaction made. TRON’s coin burn applies to developers looking to implement their currency on the Main Net platform. Imagine a game developer wishes to create a token to be featured in their product on Game.com (a blockchain-based partner of TRON). The cost of integrating their coin on the TRON network is about 1000 TRX (around 50 USD at today’s prices), which is “burned” in the process. This creates two advantages for TRON and TRON-holders: TRX becomes more valuable over time through the process of outright coin destruction (albeit at a slow rate); and future developers have an incentive to purchase TRON at lower prices. If you are even thinking about publishing on TRON’s platform with a unique currency in the future, there is incentive to buy TRX now at a lower rate in order to consume it later for the new currency. This process also gives TRX a small piece of intrinsic value: 1000 TRX is worth one new coin on Main Net, in any iteration.
TRON Investing in Future Cryptocurrency Development
Two weeks ago Ripple, the parent company behind the XRP currency, announced a 25 million USD investment they had made in the Blockchain Capital fund, a vehicle designed for investing in blockchain and cryptocurrency-based startups. The advantages to Ripple were immense: the ability to highlight and target interesting, up and coming projects and talent in the space of blockchain; to catalyze projects that will only serve to make cryptocurrency (and by extension Ripple) more valuable; and positive publicity and recognition in the crypto-space despite the naysayers who cry foul over Ripple’s centralized presence.
TRON is following suit with two similar updates by Justin Sun and the TRON Foundation. Titled Project Genesis, the TRON foundation has created a 2 billion USD reward fund for developers to participate in the enhancement of TRON’s product. As announced on Medium, the fund seeks to, “express gratitude for the trust and support of TRON’s developer community, while enriching and expanding TRON’s ecosystem.”
In addition to several unannounced projects, the fund is targeting developers for a GitHub plan, bug-bounty program and TRON loan. Like Ripple, the fund comes at a well-worth cost to the TRON Foundation, which stands to benefit from the press and renewed interest in the currency. TRON suffered from a severe backlash of FUD and negative press following the coin’s meteoric rise to 0.33 USD and subsequent fall to 0.025–all in the span of two months. While the fund has yet to give out rewards, it is sure to pay dividends in the form of increased usability and development integration of TRX for years to come.
Justin Sun has also announced a 1.5 million USD airdrop (30 million TRX), to Ethereum holders as an act of goodwill to the entire community of cryptocurrency. While the announcement was at first met with skepticism and confusion (Sun has had issues in the past translating/conveying his message with clarity to Western audiences), the coins will be disbursed to all Ethereum wallets with over 1 ETH. It’s not often in the cryptocurrency industry we see a development team gift free coins to a rival currency, but TRON is looking long-term with the approach. TRX began as an ERC-20 token built off the framework of Vitalik Buterin’s Ethereum. With the Main Net launch, TRX will at last divorce itself from ETH and establish its own platform of functionality. Sun has labeled the airdrop as a “thank you” to Ethereum for hosting the currency up until this point. However, it also represents a bit of subterfuge: TRX will become a primary competitor to Ethereum following the Main Net launch (in addition to other cryptocurrencies), and gifting current ETH holders free TRX is a way to get their foot in the door with a wider audience.
Either way, the air drop represents a substantial marketing move for Justin Sun and the TRON foundation. With Main Net coming at the end of next month, it’s only a matter of time before TRX enters the conversation as a top 10 cryptocurrency in 2018.