What Is Tron?
Tron is a blockchain network that is home to a growing number of decentralised applications (dApps) and smart contracts. Many of these dApps operate in, and advance, evolving spaces that have come to define the crypto sphere like decentralised finance (DeFi), Web 3.0, and the Metaverse.
Tron’s ecosystem is similar to that of Ethereum’s but unlike the latter, it offers faster transaction speeds and lower transaction fees that are paid in TRX, the native token of the network. The founder of Tron, Justin Sun, once notably suggested that Tron will eventually overshadow Ethereum’s market capitalisation for these very reasons.
TRX is the primary means of paying fees for all transactions on the diverse dApps found on Tron’s blockchain. Holding TRX tokens also provides users with the ability to earn rewards by loaning out their coins for certain periods of time so they can enhance the security of Tron’s network.
In addition to this, Tron uses a delegated Proof of Stake mechanism as the consensus model to govern its platform. This means that Tron’s community votes for 27 “super representatives” to take charge of many of the democratic decisions shaping Tron’s ecosystem and any potential updates to it.
Ways to Invest in Tron
As an investor, you’ll want to shape your approach toward buying Tron around your present financial position and your financial goals for the future. Some cryptocurrency investors will choose to allow the value of the TRX they own to appreciate over time while others will look to make faster –– but potentially smaller –– profits by only holding onto their TRX for the short-term.
Buy and hold Tron
The most popular strategy for investors tends to be buying and holding onto Tron for the long term because it requires a limited amount of skill and attention.
At the same time, Tron can also be staked to generate passive income for investors. This function allows investors to enhance the security of the Tron blockchain by loaning out their TRX in return for interest.
Best Tron wallets
Investors have a couple of key choices to make when it comes to the safekeeping of their Tron tokens. They can either place their confidence in custodian services by leaving their TRX in web wallets provided by exchanges or store their TRX in private crypto wallets.
Using a private wallet means you will have sole responsibility for the safety of your Tron, but is often considered a better way of safeguarding your tokens because exchanges can fall prey to cyber-attacks. In this case, you can choose to self-custody by using software crypto wallets (such as the official Tron wallet) or recommended hardware wallets like Trezor, BitBox, and Ledger. Don't forget to factor in the speed and amount of transactions you plan to make with your chosen Tron Wallet, hardware wallets tend to be a longer process than their software cousins.
Trade Tron
Rather than holding onto their Tron for the long-term, some investors look to capitalise on the fluctuations in Tron’s price by actively trading it on exchanges with the aim of generating large profits in a short time.
This is a financial strategy that requires a significant degree of expertise and can result in even the most proficient traders incurring losses. Traders will usually use web wallets, integrated with cryptocurrency exchanges, rather than private wallets to store their traded TRX because regularly transferring tokens between them can be a taxing process.
Should I Buy Tron Now?
Before buying Tron immediately, we’d advise you to conduct your own research on the project’s motivations, landscape, and roadmap for the future. To help you in this investment opportunity, here are a few points you may wish to weigh up.
Tron’s vision as a digital currency is to advance a more democratic internet where individuals, rather than large private corporations, have greater autonomy in creating, storing, and disbursing data on a decentralised web. This also means that there is no single point of failure if centralised servers crash (i.e. when Meta, formerly Facebook’s, servers crash and leave users around the world disconnected and over-reliant on one tech giant).
Because of this, many of the best and brightest developers are attracted to creating content on Tron’s blockchain that is controlled by no single entity. Alongside this, a number of developers are also attracted to Tron’s blockchain because it is home to user-friendly programming languages like Java and Python. This not only adds to the utility of the network but immediately brings more value to TRX: the token used for all transactions on Tron’s dApps.
Tron has also achieved a strong foothold in the Asian market and has secured financial backing from deep-pocketed venture capital firms in the region. This is in addition to a partnership Tron has reached with Samsung that sees them showcase some of Tron’s dApps on their Galaxy store. The investment pouring into Tron demonstrates the value institutional investors see in the project and its future trajectory.
