Understanding TRON: TRX Basics and How It Works
Which crypto to invest in? Which crypto to stay away from? As the crypto market enters the bear phase, these are the main questions crypto investors ask worldwide.
Before trading your ETH to TRX or any other coin, you must get to know its main principles and analyze the news. It will save you from getting into a pump-and-dump project or losing your money in a bad investment. In this TRX overview, you will learn about TRON fundamentals and its prospects.
What TRON (TRX) Stands For
TRON is a decentralized financial ecosystem developed by the Tron foundation in 2017. The TRON network is powered by distributed ledger technology (DLT). The chief purpose of the network is to create a decentralized Internet.
Justin Sun is the founder and CEO of TRON. Sun is known for a $4.57 million lunch with Warren Buffett and his active online presence. His project also has partnership deals with BitTorrent, Samsung, Opera, Poloniex, and oBike.
The main goals of TRON are to make sharing of digital content sustainable and easy. TRON’s official cross-network scaling solution allows data and assets to be transported across multiple networks securely, openly, and with unlimited scalability. TRON network has a special Bandwidth feature that helps transfer assets on the mainnet without gas fees.
Tronix (TRX) is the native token of the TRON network. TRON uses a proof-of-stake (PoS) protocol meaning you can use crypto wallets like TronLink to stake your TRX tokens and earn monthly rewards.
The TRON network is capable of 2,000 transactions per second (TPS). For instance, the Ethereum network is only capable to do 15 TPS.
How TRON Mechanism Works
TRON is a decentralized platform that supports the creation of smart contracts and dApps. This is how TRON works with its three-level ecosystem:
- Storage Layer. This is where all the blockchain data is securely stored. It’s also used as a segmentation tool for data within the ecosystem.
- Application Layer. This is where dApps and other items are created.
- Core Layer. This is where the processing of instructions occurs (programming is done in Java or Solidity).
TRON’s PoS protocol allows users to earn profit with TRX. You need to have at least one TRX token to start earning.
Staking TRX allows users to participate in the governance of the TRON platform. Users can also utilize TRX as a payment for the content they want to access.
TRX works well in an exchanging pair. One of the most popular is the TRX BTC exchange. Platforms like Binance have a daily TRX to BTC exchange volume of over 81 million TRX.
Promising Benefits of TRON Trading
Here are some of the advantages of the TRON network that TRX owners can enjoy:
- throughput of 2,000 TPS;
- zero transaction fees;
- peer-to-peer network technology;
- support of smart contracts and dApps;
- 7% annual staking rewards.
With dApps and smart contracts, TRON users can create cryptocurrencies and NFTs. The TRON network allows for the integration of cross-blockchain projects.
Projects established in other networks can migrate to TRON and take advantage of the network’s fast transaction speed and zero fees. For example, Ethereum gaming projects that are currently stuck due to high transaction fees can move to TRON.
Last year, TRON introduced its stablecoin, USDD. It was created as a prototype of TerraUSD with a lower risk of inflation. Now that TerraUSD has crashed, USDD will be a go-to alternative for investors worldwide. It’ll bring more attention to TRON.
Why Is Buying TRON Worth It?
The TRX token is versatile in its use. Users can create their own applications, cryptos, and NFTs with TRX. They can also stake TRX coins for generating revenue or use them for trading.
The TRON network offers users low to non-existing fees, a fast throughput, and generous staking rewards. TRON has the potential to become a better alternative to Ethereum. It’s a solid project worth your attention and funds.