While everyone is so focused on what's happening on the STEEM blockchain I decided to look at what's going on with Tron. I feel it's important to look at where people come from, their home environment before we can judge what they will do outside of it. I can only base my decisions on the information I find and if you have other information please feel free to drop it in the comments, but here's what I know so far about Tron.
The relative success of Ethereum and its virtual machine and smart contracts on a blockchain made it one of the most successful cryptocurrencies to date, rivalled only by Bitcoin. Its success would naturally attract other chains to follow suit and we see chains like EOS and Tron emerge as front runners to become so-called "Ethereum Killers".
Image path - nichemarket.co.za
The Introduction of Tron
Most people now know Tron due to Justin and his marketing and see it as the Billion Dollar market cap coin with 700+ dapps one of the most popular dapp chains and a leader in the crypto space. People feel that ETH and EOS are too expensive because they have a whole coin bias and like the idea of Tron at a few cents so they can pick up a large amount to stake.
Also, the promise of future coin burns to reduce supply is a reason why Tron Bag holders sit steady in waiting while earning around a 3% APR for staking their coins. On the surface, it looks like a reasonable investment but after taking a deeper look I am not so sure. I feel its become more about marketing and massaging the numbers and narrative than actual growth and adoption.
Image source: - coingecko.com
Decentralisation
If we take a look at Tronscan, Trons only block explorer (which leaves me uneasy, I mean can you really trust a single front end that displays blockchain data?). We can see that 2 exchanges Binance and Poloniex are part of the top Super Representatives and this only gets bigger as they get more of the block Reward/staking.
This is not to mention the tokens owned by Tron and the Zion account which is their account used during the migration from ETH ERC-20 to their own chain. This also is a threat over the decentralisation of Tron as the Tron Foundation can vote in their own Super Reps at any time as reported by CoinTelegraph. The so-called decentralisation of the chain is only through the will of the Tron foundation and not actual system protocols working in the correct manner.
Tron also recently came under fire for its hard cap removal and block reward increase two aspects which are fundamental to the value of a blockchain and the reason why many choose to invest in a chain.
Marketing
If you know anything about Tron its probably because of their marketing, they are the most Hyped coin in the space thanks to their leader Justin Sun. He is a source of eyeballs but also a central point of failure, and in crypto, I think this is a grave mistake. There is a reason Satoshi remained anonymous, there is a reason Charlie Lee sold his LTC because one person cannot be a target for the chain if its plans to thrive.
Justin has also not been shy of controversy with the recent exchange collusion reported and even money laundering accusations in the past., to plagiarism of the whitepaper to being part of a scam Ponzi scheme. I am not saying this is all true, but where there is smoke, and often so, there is sometimes fire.
Tron realises that this bad press can knock them down in a space where FUD can make or break a coin so they're constantly putting out material in a numbers game to drown out the bad press. This has worked to an extent but what it has done is polarised the crypto space around the project, pulled in novice and ignorance investors who are yes men and build an echo chamber around the coin as a protective layer.
In this way, it can shield itself from a lot of the negative opinions and obfuscate a lot of what has happened and will continue to happen with the project.
Dapps
If we look at Trons so-called 800+ Dapps according to Dapp Rader almost all of the top dapps are gambling apps. That's hardly inspiring to onboard the masses. To compound this the majority of these dapps are failing and the best performing dapp only has 2600 users.
I think it's safe to assume these users of the gambling dapps are Super reps and big Tron bag holders looking to earn more Tron either by having a dapp or playing. There isn't much actual value being created with the coin and its empty exchange of funds to make the network busy but not actually productive.
According to Dapp Radar, 90% of TRON audience interact with gambling dapps, 10% with exchanges, and 0.1% with games. The exception of the TronWatch Market exchange, the top five dapps by daily activity on TRON in 2019 are all in the gambling and high-risk category.
Even in that context, TRON’s most popular dapp – TRONBET, which was relaunched as WINk in 2019, saw peak activity in late June of 4,000 daily active unique wallets, dropping to less than 2,000 by mid-December, if this is your premier dapp it's nothing to really rave about or run home to in this crypto space. Tron realised their need for dapps and offered up incubation programs but nothing has been announced,
It's only big differentiators were dapps that were purchased and migrated to Tron such as BitTorrent, DLive and Poloniex.
When the funds run out
Tron in its current form looks like a chain living on borrowed time, sure it has funds in crypto and fiat-backed by the Tron foundation to keep it going but it has no real value for all the money spent. It's now focusing on acquisition through purchasing dapps with moderate success, luring dapps from ETH and EOS with the promise of funds and support but this has done little to grow the chains reach. Games are effectively irrelevant, exchanges are small and low value, while gambling and high-risk dapps are the obvious key category, both in terms of users and value.
Tron is not trying to innovate its way to success but trying to buy its way to success and hoping to rely on the Chinese markets numbers to be able to prop it up in the future if can reach some sort of critical mass locally. It will continue to burn through funds until either it runs out or reaches a point where the amount of users justifies recapitalisation.
You're only alive until you're dead
When it comes to investing the hot hand fallacy and recency bias are hard ideals to break. Tron on the surface looks great and brimming with potential but given the points I've listed above I think a lot of it is smoke and mirrors and we can see a lot of mismanagement coming to light. If the STEEM standoff is anything t go by I think it will unlock even more to what is going on with Tron as more eyes with different ideas start to take serious note of the project.
Have your say
What do you good people of steem think? Is Tron an emperor with no clothes on?
So have at it my Jessies! If you don't have something to comment, comment "I am a Jessie."
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