Tron is a crypto network that has been gaining popularity since its launch in 2017, but what is Tron and how does it differ from its competitors? Learn more about Tron, its native cryptocurrency, and how the price of TRX has fluctuated since its launch.
Tron is a crypto network designed to create a global ecosystem that enables the cost-effective sharing of digital content. Despite questions surrounding the project’s decentralisation, as well as criticism directed at its founder, Justin Sun, Tron has grown to become one of the world’s largest and most active blockchain networks.
Tron utilises a consensus mechanism called “delegated Proof of Stake” (DPoS), which is designed to be more democratic, efficient and scalable than traditional Proof of Work (PoW) or Proof of Stake (PoS) mechanisms. Consensus mechanisms are used to ensure that all transactions on a blockchain are recorded and legitimate, and DPoS allows users to vote for representatives to validate these transactions and produce new blocks in the blockchain.
Tron operates using its native cryptocurrency Tronix (TRX), which is used to power the network’s various decentralised applications (dApps). But what is Tron, how does it work, and what does the future look like for TRX?
What makes Tron different?
Tron has focused its attention on several different areas since its launch. Currently, Tron’s main goal is to enable users to create, share and consume digital content without intermediaries or censorship. To achieve this, Tron has developed several protocols and features that support different types of content creation and distribution.
- BitTorrent is a peer-to-peer (P2P) file sharing network, acquired by Tron in 2018 and integrated into the Tron blockchain. BitTorrent enables users to distribute large files, such as videos, music and games, without relying on centralised servers or platforms.
- TronLink is a browser extension and mobile app that connects users with the Tron network and allows them to access dApps, manage their TRX and other tokens, and interact with smart contracts.
- JustNFT is a protocol on which users can create, trade and collect non-fungible tokens (NFTs).
Tron is attempting to transform the digital content industry with blockchain technology. As a network, it is quick to integrate new technology that has been proven to be popular on other platforms, which is why its main area of focus has shifted over time.
TRON is an ambitious project dedicated to the establishment of a truly decentralized Internet and its infrastructure.
Tron Whitepaper
What is the TRX price and forecast for the future?
Throughout its history, the TRX price has tended to follow the rest of the crypto market, which means that its price movements have mostly been correlated with the price of Bitcoin (BTC) and its four-year halving cycles.
| Year | Start Price | Mid-Year Price | End Price | Percentage Change |
|---|---|---|---|---|
| 2017 | – | – | $0.045 | N/A |
| 2018 | $0.045 | $0.038 | $0.019 | -58% |
| 2019 | $0.019 | $0.032 | $0.013 | -32% |
| 2020 | $0.013 | $0.016 | $0.027 | 108% |
| 2021 | $0.027 | $0.068 | $0.075 | 178% |
| 2022 | $0.075 | $0.065 | $0.055 | -27% |
Prices have been rounded to three decimal places | Past performance is not an indication of future results
Source: Yahoo Finance
A cursory look at the year-to-year price movements of TRX does not accurately reflect some of the token’s more volatile price moves since its inception. For example, on January 5, 2018, TRX reached a price of $0.30 per token, an increase of 566% in five days.
Some investors have written off Tron as nothing more than an Ethereum clone, but the network has one of the most active blockchain ecosystems in the cryptocurrency space. Because of this, it is impossible to accurately predict the future price of TRX, but the network’s adaptable nature hints at a strong future, at least in terms of wider adoption, if not in price.
Who created Tron?
Tron was founded in 2017 by Justin Sun, a Chinese entrepreneur and former chief representative of Ripple (XRP) in China. The project raised $70 million in an initial coin offering (ICO) in August 2017.
Tron was initially created as a layer 2 network, built on top of the Ethereum blockchain. In June 2018, however, Tron migrated to its own, independent layer 1 network. Despite the transition, Tron still shares a number of similarities with Ethereum, and has faced accusations of plagiarism in the past due to connections between the whitepapers of the two networks.
Since its launch, Tron has continued to expand its scope and influence by acquiring several prominent platforms within the cryptocurrency space, including BitTorrent, Steemit and DLive. Tron hosts one of the world’s largest circulating supplies of stablecoins, and supports various tokens on its network, including BitTorrent Token (BTT).
Tip: Many investors choose to invest in cryptocurrencies because of their volatile nature, but this is also what makes the asset class such a risky investment.
Final thoughts on investing in Tron
Despite claiming to be a “purely community-governed DAO” since 2021, questions are still being asked about how decentralised the Tron network really is. Regardless, TRX has one of the highest market capitalisations of any cryptocurrency, with Tron operating in a similar fashion to a traditional start-up; it is extremely agile and regularly changes direction.
TRX is an altcoin with slightly less volatility than other cryptoassets, and so, it could potentially be a good option for investors looking to diversify their portfolio. Remember, however, that cryptocurrency investments are best suited to those with a higher risk tolerance.
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FAQ
- How do you buy TRX?
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TRX is a widely traded cryptoasset, so is available to buy from most crypto exchanges and trading platforms. For those wondering how to buy TRX, create an account and complete the verification process. Make a deposit, find TRX on your chosen platform and make your purchase. Most exchanges will allow you to buy fractional shares of TRX.
- What is TRX used for?
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TRX is the native crypto token of the Tron protocol. It is the primary method of transacting on the Tron blockchain and connects the network’s entire ecosystem. Owning and freezing TRX tokens entitles holders to network voting rights through Tron Power, and TRX can also be used to purchase tokens issued on the Tron blockchain, among other things.
- Is Tron based on Ethereum?
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Tron is derived from Ethereum, a separate, distinguished blockchain platform that enables the creation of smart contracts and decentralised applications. Although there are similarities, Tron has made some modifications to the Ethereum codebase, such as increasing the capacity of the network, which has led to lower fees but increased centralisation.
This information is for educational purposes only and should not be taken as investment advice, personal recommendation, or an offer of, or solicitation to, buy or sell any financial instruments. This material has been prepared without regard to any particular investment objectives or financial situation and has not been prepared in accordance with the legal and regulatory requirements to promote independent research. Any references to past performance of a financial instrument, index or a packaged investment product are not, and should not be taken as a reliable indicator of future results. eToro makes no representation and assumes no liability as to the accuracy or completeness of the content of this guide. Make sure you understand the risks involved in trading before committing any capital. Never risk more than you are prepared to lose.