Learn Cryptocurrency
14 Jan 2021

Tron(TRX) Explained & How Does it Work

CoinSwitch Kuber

Tron was founded in 2017 by Justin Sun. He had the vision for fair payments to content creators. TRX was an ERC-20 Ethereum token until 2018, after which it separated to become an independent token.

Tron is a blockchain platform that started with a vision to decentralize content sharing on the internet. It has its own Tron cryptocurrency known as Tronix (TRX) that is used to unlock the features of the Tron ecosystem.

Tron eliminates the middlemen from the picture and allows direct content sharing from creators to consumers. This saves up costs and provides a fair share for the work.

Tron raised $70 million in its ICO (Initial coin offering) and also acquired Bit Torrent in 2018. The founders of Tron played smart as Bit Torrent is the largest file-sharing platform with an enormous user base. Tron Cryptocurrency or Tronix (or TRX) is the native utility token of the Tron blockchain. It enhances the network’s security by staking and is also used for smart contract computations. Staking refers to the users’ participation in confirming the transactions happening on the blockchain (similar to mining). 

How Does Tron Work?

The working of Tron depends on a few principles. Tron harnesses the power of blockchain technology and Peer-to-Peer mode by directly connecting the creators with the users. All this work is done by smart contracts in the backend to facilitate a seamless process.

People need to have TRX with them in their digital wallets to interact with smart contracts. For any developmental purposes, users would be required to lock their Tron tokens. However, this doesn’t mean that your TRX is burned. The coins will be released to your wallet after the cooldown period. If we talk about coin burning, the best one-liner explaining this concept would be ‘removing the existence of a particular coin’ from the ecosystem.

Tron is fueled by none other than Delegated-Proof-of-Stake (DPoS) consensus algorithm along with Super Representatives for verifying the transactions happening on the blockchain. DPoS consensus mechanism has evolved over a period of time which requires delegates (as in the name) to validate the blocks. The users of the network elect these delegates. DPoS has lined up a variety of features, some of which are:

  • Faster transaction speeds than PoS
  • Better energy efficiency than PoS
  • Allows a feel of democracy by letting users select the delegates.

What are Super Representatives? How do they work?

Super representatives (SRs) are the pillars of the Tron ecosystem. They help verify transactions, add them to blocks, and suggest improvements for the Tron blockchain. 

Tron allows for 27 super representatives elected by the users holding TRX in an open election. This also concludes the fact that TRX acts as a governance token of the blockchain.

How to Mine Tron (TRX)?

You can gain TRX by mining Ethereum on your graphics processing unit (GPU); this is far more efficient for miners to mine with GPUs rather than using a CPU. To mine Tron, all you need to do is go to the Tron mining site. The platform allows you to mine Tron using two different algorithms indirectly, Ethash or CryptoNite algorithms, respectively.

You will have to mine Ethereum in the normal way it is mined. The platform then takes the Ethereum rewards and utilizes them for their mining pool. After this is done, the platform will exchange it and pay it back to you in TRX. 

Tron Smart Contracts 

Let us have a look at what smart contracts are. Smart Contracts are self-executing code in the blockchain. While blockchains can record transactions, smart contracts enable complex transactions. With their help, a blockchain can execute deals. Smart contracts are the key to decentralized applications (Dapps) and non-fungible tokens (NFTs).

How Does Tron Outstand The Market?

Tron has been a market player ever since its inception. Currently standing at 27th position in terms of market capitalization, it surely has distinguishing features, which we will discuss below. 

Governance:

Tron allows its users to vote for the Super Representatives and their partners that will help in the overall development of the ecosystem. To gain voting rights, staking TRX coins is an essential step.

Transaction costs:

There are no fees involved if you are transacting TRX on its ecosystem. If you are looking to buy it from a cryptocurrency exchange, you might have to pay the fees to exchange for connecting you with a seller.

Tokens:

Tron supports a wide variety of tokens, including TRC-20, TRC-10, etc., that help developers work for greater causes.

Transaction Speeds:

 With Bitcoin still stuck on 3 transactions per second, Tron is capable of processing 2000 transactions per second (TPS) that could be a major factor for its adoption.

Decentralized Applications:

Tron also welcomes developers to build DApps on top of it and earn TRX by sharing content across its platform.

Tron Cryptocurrency Infographics

How to Buy Tron Cryptocurrency?

Tron could be bought on decentralized exchanges through P2P (Peer to Peer) trade. P2P trade involves looking for an exchange that connects you with a seller holding the cryptocurrency you need. You can then buy the Tron and store it in a digital wallet. A cluttered look and out-of-the-blue features make it really difficult for someone looking to buy cryptocurrency. The reason is that it is preferred only by pro traders.

There are plenty of options to explore for buying cryptocurrencies, with dozens of applications and websites offering their services to help you invest in cryptos easily. CoinSwitch Kuber is one of the leading market players that allows buying Tron with just a click!

Looking to invest in Tron? You can buy Tron for just ₹100

Its easy-to-use interface, quick KYC process, and low starting amount make it a perfect place to start for people who are new to cryptocurrency. It allows for a wide range of payment options such as UPI or Netbanking.

How to Earn Tron (TRX)?

Tron could be earned through two procedures broadly:

  • Staking: Tron could be earned by staking the existing tokens to validate transactions. This helps in gaining computational power to the validators. Users are paid the transaction fees in return.
  • Investing: Tron has shown very positive returns over time. Since 2018, the value of TRX has zoomed more than 60x and brought in very speculative returns. With a different perspective to democratize the content industry, it surely can be a good bet!

Conclusion

Tron is a project that is aimed at decentralizing the way content is shared on the internet. With a lot of competitors such as Youtube, Amazon Prime Video, Netflix, etc. already existing as centralized entities, it can surely put a dent in the growth of Tron,

However, the generation is looking for ways to adapt blockchain technology and revolutionize the way things have worked in the past. Tron could be a fruitful asset that can provide gains over a period of time. 

We request you to DYOR (Do your own research) before investing in any cryptocurrency. 

Want to buy TRON in India at the best prices? Check out the CoinSwitch app.

Convert TRON to INR seamlessly on the CoinSwitch website.

FAQs On Tron Cryptocurrency

Q1. What is the Future of Tron Cryptocurrency?

Ans. Tron has started a revolution to provide a fair share to content creators. According to the experts, the future of Tron looks bright with changes and developments made very frequently.

Q2. Where to Buy Tron Cryptocurrency?

Ans. You can buy Tron from a variety of platforms. CoinSwitch Kuber is one platform that takes away all the hassles of buying cryptocurrencies and provides you with complete peace of mind.

Q3. Is Tron Good Crypto?

Ans. Tron and all other cryptocurrencies exist for a purpose (neglecting a few exceptions). It looks like a good bet that Tron has provided handsome returns in the past. However, we encourage you to research before investing and only invest that you can afford to lose.

Disclaimer : Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. The information provided in this post is not to be considered as investment/financial advice from CoinSwitch. Any action taken upon the information shall be at user's own risk.

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