Tron is a Chinese cryptocurrency, led by a foundation in Singapore and developed by a worldwide open source team. It’s attempting to build a platform to decentralise the entertainment industry. The channels of distribution are owned by the Googles and the Apples of the world. Attention is a commodity and we pay for content with our clicks, views and likes. What Tron wants to do is build a ledger that cuts out the middleman and pays the creator directly for their attention.
What Will Tron Be Used For?
The TRX Coin is a cryptoeconomic incentive for people all over the world to commit computing resources to the Tron network. A database will be stored on this decentralised network to hold and distribute entertainment content from all over the world.Using the TRX coin, a user could buy a song and then be able to download it or, just as easily, add their own song for others to download.
This use case is what Tron is targeting, but it isn’t all they have planned. With ambitions to implement smart contracts on their main net, Tron wants to become a financial ecosystem that can issue its own tokens and track them on its network. This lets different companies, apps and assets, distribute tokens, which have value and consensus backed up against the Tron network.
Tron can’t be compared to currencies like Bitcoin, Litecoin and Bitcoin Cash, but there is an emerging wave of cryptos offering smart contract functionality; Lisk, Maidsafe, Cardano, and Stellar are just a few recent altcoin that have smart contract functionality planned.
This didn’t stop Tron attracting a lot of attention. The ICO raised over 80 million dollars and the market cap has briefly exceeded $16 billion. Tron’s CEO Justin Sun, is a serial tech entrepreneur with a cult like following. He is well connected, and I think this has definitely helped Tron get massive companies like oBike and Peiwo (Sun’s own company) to agree to use Tron’s tech.
TRX coins will be used to pay for the transactions and computation that smart contracts incur on the network. These partnerships point to future circulation, which should drive up the price.
oBike, is a multinational bike sharing and food delivery company that operates in 20 countries across Europe, Asia and Australia, ~10 million total users. Peiwo APP is the largest audio content community in China, with over 10 million global registered users and more than one million monthly active users.
What Is The TRX Coin?
The Trx coin will be used to pay for items and transactions on the Tron Network. Tron is also using a proof of stake blockchain. Currently TRX is an ERC20 token, but once they release the main net it won’t be. On a POS blockchain, stakers can vote on different chains, and they are rewarded for doing this with more tokens. There is nothing stopping stakers from voting on multiple chains to try maximise their reward. It is called the Nothing At Stake problem.
How most cryptocurrencies, that use a POS algorithm, get around this was requiring a staker vest a large amount of tokens in escrow. TRX coins will be used to disincentives malicious nodes for taking part in the network.
TRX coins will also be the medium of exchange across applications and smart contracts on the Tron network. Even if companies implement their own tokens, they can still use Tron for equivalent payments, and trade them on an open marketplace.
Tron Main Net And The Move Away From Ethereum
implementation of the first Beta Version of the TRX Main net is scheduled for the 31st of March, 2018. After that there are a series of planned releases mapped out for development towards the completed main net.
The main net, according to Justin Sun, will be about 60xs faster than Ethereum. This will help Tron overcome the scalability issues of ERC20 tokens. How are they going to achieve this? In a stream headed by Lucian, former Alibaba big data expert, and the Tron development team explained how Tron will use” UTXO-based trading models -history transactions- that can be transparently tracked through the public ledger. UTXO boots concurrent processing capability and enhances network performance. Create the concept of transaction account that is in consistent with real-world application through abstraction based on UTXO technology.
UTXO, stands for Unspent Transaction Output. Rather than process every single block and distribute it to every node on the network, Tron’s PoS-based TBFT consensus mechanism which adjusts the account takers of a transaction according to the speed and delay of the block. They claim that they can do this consistently, and their maths checks out. This system is untested at scale, but it has been developed by an active open source community and there is a test net that lots of developers have tried to fault.
This network will support ultra-low fees (10e-6 TRX per transfer), and provide a secure execution environment for smart contract byte-code with TRON virtual machine (TVM). This protects computers on the network from malicious behaviour and secures the network by limited its connections and by extension vulnerabilities.
Tron will support smart contracts written in common programming languages like Java. It will then act as a compiler that converts this code into the TVM byte-code, which is the language that Tron smart contracts run on.
The best resource on the internet for how Tron works is definitely the Tron Live Stream. Watch it if you are interested in understanding, how the team are developing Tron and the planned to implementation of KhaosDB.
Should I Invest in Tron?
If Tron goes on to do what is says it is going to, it has the hype and the team to do great things. If that statement sounds a little innocuous to you, you’re catching on to just how speculative Tron’s value is. I consider it a medium risk crypto investment. Honestly the biggest thing Tron has going for it is probably that it is backed by Justin Sun. The marketing first approach and current market conditions go together nicely.
Justin Sun has tweeted and shilled his cryptocurrency to a 20 billion USD market capitalization in less than four months without a fully working product and a handful of partnerships. He is a well connected guy, and I think that there will be plenty more partnerships announced. Businesses know that associating themselves with cryptocurrencies, like Tron, is good for exposure.
Tron has announced some partnerships while market sentiment has been bearish. The market’s disinterest left impatient investors critical of the currency’s future. I think the market’s reaction to the TRX main net will play a major role in deciding the outcome of this coin. Tron is a volatile altcoin. If it is going up, big news is about to be announced, or cryptocurrencies are at the floor of a bear market of rise of a bull, buy Tron and hold.
Tron has consistent developments lined up for the next 7 – 8 years.
Interested in investor specific information about Tron? Click here for Coinlist’s complete guide to buying altcoins like Tron.
The open source development of Tron is supported by a foundation, called the Tron Foundation. They were established in Singapore as a nonprofit organisation that mainly engages in operating the TRON network in the principles of openness, fairness and transparency and supporting TRON’s development team.
It is run by the Board of Trustees or the Board of Governors formed by eligible trustees for independent management and operation, which is also independent from the government’s administration.
Tron was founded by Justin Sun. He has a list of accolades to his name, and is well established in the Chinese business community, which from my admittedly limited exposure, seems more tightly knit and favour orientated than its western counterparts. Justin Sun isn’t the only noteworthy name behind Tron.
The team is filled with Chinese millionaires and seasoned developers. The corporate talent behind Tron is properly impressive, and I doubt there is another cryptocurrency that comes from the same pedigree. What remains to be see is if their experience team of developers can bring a working product to market. This is a conglomeration of incredibly rich and powerful people. Tron will inevitably compound their wealth, and all a Tron investor can ever hope is that they use some of that leverage to take us along with them.