What is Tron? | The Ultimate Beginner’s Guide
Tron is a blockchain-based decentralized application (dapp) and smart contract platform aimed at creating a digital entertainment ecosystem. The platform is intended to eliminate the middlemen between content providers and consumers through the power of blockchain.
Tron’s Initial Coin Offering (ICO) ran from August 3rd to August 24th 2017 and the platform officially launched on 9th September of that year. The project is backed by notable members of China’s business community as well as numerous blockchain industry figures.
Late 2017 and early 2018 saw Tron’s Tronix cryptocurrency (TRX) rocket up in value based on the potential that the project has in its sights. With a current test net underway, the Tron platform main net is expected to launch on May 31st, 2018.
In this article we’ll explore more about what this means, how Tron stacks up against its competitors, and the project’s current status by looking at the following topics:
- What is Tron?
- The Technology Behind Tron
- Tron Roadmap
- Whitepaper Plagiarism Controversy
- Tron Advantages
- Tron Disadvantages
- How to Buy Tronix (TRX)
- How to Store Tronix (TRX): Best Wallets
The Tron Protocol is a blockchain-based operating system for smart contracts and dapps, with a focus on entertainment, social networking and gaming. Tron has several first-party dapps in the works including a content sharing ecosystem and an online television platform.
Tron was founded by a non-profit Singapore-based group called The Tron Foundation and is led by its young, passionate and vocal CEO, Justin Sun. Sun has been listed on the Forbes Asia 30 under 30 list and is also the creator of the chat app Peiwo. He is a recent graduate of the esteemed Asian business college created by Alibaba’s Jack Ma, Hupan University. He has also served as the former Chief Representative for Ripple in Greater China.
The Tron platform is based on a white paper first-published in mid-2017 and then revised in early 2018. The Tron team members took their inspiration for the project from Sir Tim Berners-Lee—the inventor of the World Wide Web.
The foundation states its key principles are transparency, fairness, and openness as well as the Berners-Lee-inspired principle of helping all people instead of focusing on profits for specific groups.
Tron’s strong ICO campaign in mid-2017 managed to raise a mammoth $80 billion in a short span of time. Coupled with a strong investment community based in China, the project looks poised to deliver on at least some of its promises.
Let’s take a closer look at the technology behind Tron, how the platform aims to function and what solutions it hopes to offer.
Tron will also use a graph database that will allow the platform to store the entire network including its structure and data. This allows for fast path-finding and search capabilities. It will also ensure fast processing and make the platform relatively easy to update. These technologies are crucial for keeping Tron scalable into the future.
Tron has established several core values that must always be followed. Users who create data will always have fundamental ownership of that data. Anyone who contributes to the Tron ecosystem is entitled to profits of a proportional value. Additionally, in the interest of fairness, all types of contributions will have the same value and time invested.
When a user of the Tron protocol creates new shareable content, they can upload it directly to the TRON blockchain. Each response (like / clap / share etc) will reward the creator with direct compensation in the form of TRX which is the platform’s currency token.
In essence, the platform aims to cut out the large corporate middle men (players such as Google, Youtube, Spotify, Apple etc) who currently take a slice of the content providers’ rewards. This eliminates censorship, control and even privacy issues—which are beginning to plague many of these centralized service providers.
Tron Virtual Machine (TVM) is designed to be the platform’s in-house developed television dApp. It is planned to be decentralized and extremely fast, with little to no loading or buffering.
The Tron network’s currency, TRX, can be earned, spent and used for a wide range of services (e.g. posting videos, bike sharing, buying or selling coffee). While other cryptocurrencies may be more specialized, Tron aims to establish its protocol as the go-to blockchain platform for a variety of services, with TRX serving as the “exchange” currency.
Tron will achieve this by allowing all applications and partnerships to implement their own native, individual company coin usage on the Tron protocol. Much like how the Ethereum network platform is able to issue ERC-20 tokens for its dApps, Tron intends to issue Tron 20 tokens for its dApp partnerships. By hosting many different company coins on its protocol, Tron will allow individual content owners and users the flexibility to interact with each other without the added hassle of converting one currency to another. TRX will be the medium of exchange.
The Tron blockchain platform will be based on the popular UTXO-based trading model used by Bitcoin and many other blockchains. UTXO is an abbreviation for Unspent Transaction Output. In a UTXO database, fully validating nodes use unspent transaction outputs to determine whether or not a transaction is valid. All inputs to a transaction must be in the UTXO database for the database to be valid.
Tron makes use of a multistep consensus strategy with the final step being a protocol system similar to Proof of Stake (POS).
TRX currency can be locked away to gain Tron Power (TP). TP gives users upward mobility in the ecosystem through voting rights and higher status on the network. The longer users’ tokens are locked away, the more TP Tron they will be rewarded with.
Tron is a long-term project with a set of phases scheduled for its introduction and implementation.
These phases, scheduled from 2017 through to 2027, can be described as follows:
- Exodus: offer users a reliable and completely free platform for peer to peer distribution, storage and content, with the goal of data liberation.
- Odyssey: economic incentives will be introduced to encourage content creation and empowerment. Users will get a fair return on the content they create and distribute, encouraging them to help build the system.
- Great Voyage: a focus on personal and individual ICO capabilities addressing issues related to paying dividends, managing supporters and measuring income.
- Apollo: the focus switches to the free movement of value and will introduce the ability for content producers to issue their own personal tokens (the Tron 20 token).
- Star Trek: create a decentralized, online gaming platform that can be built by developers freely. This will facilitate the prediction of market functions, fully autonomous gaming and monetizing traffic.
- Eternity: developers will have the ability to set up and crowdfund their game development with ease. This will let users invest in games they are interested in and influence the future of the gaming marketplace.
On December 26th 2017, Tron announced a partnership with oBike, a multi-national bike sharing company that operates in 20 countries across Europe, Asia and Australia with 10 million total users.
- Global Social Chain (GSC) / Mico
On January 27th 2018, Tron announced that it has formed a strategic partnership has been formed with GSC (Global Social Chain). GSC and its relationship with Mico is a mobile social platform for the global market with over 100+ million registered users.
- Piewo App Integration
On February 7th 2018, Peiwo App declared the successful integration with TRX. This allows Peiwo users to deposit and withdraw TRX with a cryptocurrency wallet. Users can also choose to purchase and donate virtual gifts (known as “tipping”). Peiwo currently has over 10 million registered users worldwide and more than 1 million monthly active users.
- Gifto / Uplive
Tron has secured a partnership with Gifto—a new universal gifting blockchain platform. This company is linked to Uplive, which is a live streaming mobile application with over 20 million users. This will help facilitate a vast amount of transactions using virtual gifts.
- Game.com – Pet Planet/Love.Pet
With the recent success of the popular CryptoKitties game on the Ethereum blockchain, Tron has formed a partnership with Game.com to introduce their own brand of blockchain tech fun with Pet Planet.
In March 2018, Tron announced a partnership with BitGuild, a blockchain game platform. BitGuild aims to transform online games by building blockchain-based gaming platforms with the goal of reshaping the relationship between gamers, developers and game content.
Around the same time, Tron also formed a strategic partnership with Trip.io – the world’s first online travel blockchain project. Trip.io is dedicated to redefining the online travel market via blockchain technology solutions.
All of Tron’s partnered dapps that are currently built on the ERC-20 platform are expected to migrate from the Ethereum protocol over to the Tron protocol (scheduled for June 2018).
In early January 2018, Tron met its first major controversy when it was revealed that their initial English-version whitepaper—released in August, 2017—was largely plagiarized from other published whitepapers. Specifically, the paper was found to have had at least nine pages of copied code, text and key ideas from the whitepapers of cryptocurrencies Filecoin and IPFS–both written by Protocol Labs.
Analysis of Tron’s original 2017 whitepaper.
Source: Juan Benet, Twitter @juanbenet 01/07/2018
The controversy wasn’t limited to Tron’s English-version whitepaper; its Chinese version suffered similar criticism. However, this was explained by Tron founder, Justin Sun, as a sloppy translation error made by volunteers. The original whitepaper was also out-of-date and did not reflect the current state of the code being developed for the platform by the time the controversial news story broke.
A revised English-version and Chinese-version of the whitepaper was released later that month without any plagiarized content. It has been noted that the debacle could have been avoided with proper citation. This episode adds to the perception that Tron might not be all that it claims to be.
Data Liberation: A strong factor in Tron’s “big idea” and a major reason for its appeal is that the platform will allow its users to have the fundamental ownership of their own data and created content.
Transaction Rate: Tron is potentially superior to Ethereum, and potentially other platform rivals, with an estimated fast rate of 10,000 transactions per second (TPS) compared to Ethereum’s current slower rate of 25 TPS.
Zero (or “ultra-low”) Transaction Fees: This is another advantage for Tron over other network protocols with fees that charge you to transfer your currency from one destination to another.
Consistent Coinburn: This is planned to occur whenever a new dApp registers on the new platform. The registration fee of TRX will be burned, effectively reducing the overall supply pool. The more popular the platform becomes, the more dApps register and the more TRX coins are burned. This is a value advantage compared to other currencies such as Ethereum which maintains the same supply without any coinburn.
Popularity: TRX is already well-known in cryptocurrency circles due to the buzz created by its founder, Justin Sun, and its enthusiastic community. It is listed on 39 exchanges with 7 fiat currency trading pairs. With its level of existing support, it already has 100 million potential users before its official launch.
Strong Extensibility: Given Tron’s platform goals and design, it will have a solid support of a wide range of dApps covering a vast array of different uses.
Personal ICO: Tron will allow its users to start their own ICO’s by giving away digital assets individually.
Funding: Tron has a strong list of solid investors, has already raised a vast sum of funds and plans to spend $1 billion USD on developer rewards and community support.
Source: Tron Whitepaper
Uncertainty: The Tron platform as yet is untested without a single real-case user of the coin at present, so there is always a potential risk in the unknown. However, the Tron test net has already been launched. The main net is planned to launch on May 31st, 2018.
High Supply: In terms of TRX currency as a speculative investment, TRX currently has a circulation of over 65 billion coins and will have 100 billion coins in its planned total supply (the remaining coins are planned to be released January 2020). Some see this as being too much for it to have any significant monetary value.
Time: The end of the long planned roadmap of various phases in Tron’s plan is effectively over nine years away. The pace and nature of this fast-evolving industry may change in that timeframe.
Tronix is available on a wide range of online exchanges. Currently there are only a few exchanges that convert fiat currency directly to TRX. These exchanges are YoBit, BitFlip and Coinnest and allow users to buy TRX with USD, EUR or KRW. As these exchanges are not well-established, it may be easier to purchase a more readily available cryptocurrency like Ethereum (ETH), Bitcoin (BTC) or Litecoin (LTC) before converting that to TRX on an exchange.
The easiest way to do this would be to create an account on Coinbase and purchase your ETH, BTC or LTC using either a credit or debit card, or via a bank transfer. From there, you can move your coins to an exchange that trades in TRX. Some exchanges suitable for this would be Binance, Bittrex or Cryptopia. Pay attention to the withdrawal fees for these exchanges.
Learn more in our How to Buy Tronix TRX guide.
As TRX is currently an Ethereum token, it can be stored in any wallet that supports ERC-20 tokens. The safest choice for storage would be a hardware device such as the Ledger Nano S or the TREZOR wallet. Software wallet options include Jaxx or Exodus as well as MyEtherWallet (MEW).
When Tron launches its own protocol network platform (June 2018), it will most likely release its own wallet. Given Tron’s popularity, there will most likely be other wallets who will add the new TRX to their list of supported cryptocurrencies. When TRX is no longer an ERC-20 token (it may even adopt a new ticker name), it will advise all holders on how to migrate across to its new platform.
Of the many cryptocurrency platforms currently in the works, Tron is definitely one of the most ambitious. Within a short period of time, Tron has amassed a vast amount of funding and generated quite a lot of interest. It has also created and fostered a community with the prospect of big things if those numbers can be converted from potential to actual users.
What Tron does with this potential remains to be seen, but there will surely be many watching it closely as it develops further. If Tron’s goals can be realized, it will be a useful solution for those in search of a decentralized protocol for online content, entertainment and commerce.