The price of Tron has made a steady recovery after it dropped to an annual low of $0.05 in February. At the time of writing, the TRX token was trading at $0.075, bringing its total market capitalization to over $7.3 billion. This makes it the 24th largest cryptocurrency in the world. Here are the five things to consider when buying Tron.
Tron is a proof-of-stake coin
Blockchain projects are built using various technologies. Bitcoin, the world’s first cryptocurrency, introduced a concept known as proof of work. PoW is a secure technology that makes it possible to generate new coins using computer algorithms. While the process is safe, it requires significantly expensive computers and the process is often expensive. Tron does not use the proof-of-work approach. Instead, it uses proof-of-stake, which is a process that uses validators to generate new coins. PoS is generally friendlier to the environment and is known to be faster than proof-of-work. In fact, some of the most well-known blockchain projects have already adopted PoS technology. Ethereum is transitioning from PoW to PoS during the Ethereum 2.0 update. Other popular platforms that use PoS are Polkadot, Avalanche and Terra. There are several benefits that come from the fact that Tron is a PoS currency. First, it means that one can easily earn wagering rewards. Staking is a process where you just deposit your funds on an exchange like Coinbase and Binance. After doing this, you will be earning a certain amount of interest monthly. Staking is not possible with PoW networks like Bitcoin and Kadena. Second, as proof of stake, Tron is a significantly faster blockchain project than other networks. According to its website, it can handle over 2,000 transactions per second. Bitcoin can only handle less than 10 TPS while Ethereum handles less than 20 tps. Third, Tron is easily integrated with other blockchains like Avalanche and Solana.
The Tron ecosystem is growing
The second thing you need to know is that the Tron ecosystem is seeing strong growth. In recent months, the number of developers building using Tron is growing. Most of these developers are in the decentralized finance (DeFi) sectors, while others are in the metaverse and non-fungible token (NFT) sectors. According to DeFi Llama, there are now 9 apps built using the Tron platform. Some of these apps are JustLend, JustStables, SunSwap, and SocialSwap, among others. These apps have a total blocked value (TVL) of over $4.4 billion. JustLend has a TVL of over $1 billion and is experiencing strong growth. With the current TVL, Tron is the 7th largest app in its ecosystem. One of the biggest parts of the Tron ecosystem is the BitTorrent Chain. It was the first scalable heterogeneous cross-chain interoperability protocol. Apps built on BTTC are compatible with other chains like Ethereum, Solana and Fantom. The relationship between Tron and BitTorrent started in 2018 when Justin Sun acquired it. After years of development, they launched BTTC, whose native token is known as BTT and has a total market cap of over $1.8 billion.
Tron faces stiff competition
Another thing you need to know when you want to buy Tron is that your competition is increasing substantially. When Tron launched a few years ago, there were quite a few competitors. At the time, Ethereum was one of the few platforms with smart contract capabilities. Today, the industry has become so competitive with apps that use different strategies. Some of Tron’s biggest competitors are Terra, BNB Chain, Avalanche, Solana, and Fantom. All of these are significantly larger than Tron. Other minors that are becoming major threats to Tron are Polygon, Cronos, Arbitrum. Waves and Nearby. All these platforms are changing their industries using different features. For example, Near Protocol and Ethereum have adopted sharding technology in an attempt to increase throughput. On the other hand, Polygon is a layer 2 network whose purpose is to overload Ethereum applications. Therefore, the growth in the price of Tron will depend on the number of developers who will adopt the network.
Tron has a stablecoin
Stablecoins are becoming players in the blockchain industry. Unlike normal cryptocurrencies which are highly volatile, these currencies are backed by fiat currencies like the US Dollar and the Euro. Some of the biggest stablecoins are Tether, USD Coin, Terra USD and Binance USD. In total, stablecoins hold more than $200 billion in assets. In April 2022, Justin Sun of Tron announced that the Tron Foundation was ready to launch a new stablecoin known as USDD, or decentralized USD. Once launched, it will be the first stablecoin in the Tron ecosystem. Unlike other stablecoins, Tron’s stablecoin will be fully decentralized, meaning that it will not rely on any centralized organization to store the reserves. Instead, these reservations will be provided by Tron DAO. USDD will also differ from other stablecoins in that it will not be backed by a fiat currency. Instead, it will be pegged to the TRX. As a result, when the USDD price drops below $1, users can send 1 USD to the system and receive 1 USD in TRX. It is the same concept as Terra USD.
Tron is highly liquid
Finally, Tron is one of the most popular cryptocurrencies in the world. As a result, it is offered by most exchanges like Coinbase, FTX and OKX. It is also one of the most widely held cryptocurrencies. According to its website, it has over 88 million accounts. Therefore, this makes it one of the most liquid cryptocurrencies you can buy or trade.