In 2017, Justin Sun founded Tron, who is now the CEO. Sun achieved recognition by Forbes Asia in the 30 under 30 series for entrepreneurs. In the past, he was a chief representative with Ripple in the Greater China area.
The Tron foundation raised $70 million with its ICO shortly before China had a wobble and outlawed the digital tokens. No matter, because that didn't stop Tron from moving ahead.
In 2018, Tron switched to an independent peer-to-peer network. Previously it was an ERC token on top of Ethereum. In Mid-2018, Tron acquired BitTorrent, which was the largest peer-to-peer file-sharing network.
In January 2019, Tron had a market cap of around $1.6 billion, but it was viewed as yet another complex and disorderly cryptocurrency. Today's market cap for Tron is $6.9 billion.
This guide will look at how to stake Tron and the particularly unique aspects of staking Tron. You will discover how to gain and maximise TRX rewards and how to achieve free transaction fees.
- What is TRON?
- What is Delegated Proof of Stake (DPoS)?
- What is Freezing?
- What are Tron Tokens?
- Where Can I Stake my Tron?
- Should you Stake for Tron?
- Risks of Staking Tron
- The Key Takeaways of How to Stake Tron
What Is TRON?
Tron is a decentralised platform that launched a dedicated blockchain in May 2018 focused on entertainment and content sharing.
TRX is the digital token for Tron.
Tron strives to be global and decentralise the Internet and the infrastructure by offering low cost, high-speed transactions, and scalability.
Tron suggests their network has the capacity for 2,000 TPS (transactions per second). Bitcoin is currently 6 TPS, and Ethereum is up to around 25 TPS. Tron transactions are low-cost and, in some cases, free.
Tron's blockchain supports other tokens known as TRC-10 and TRC-20 tokens. Tron uses delegated proof-of-stake (DPoS) to secure the blockchain.
Read Also: Could Tron Be A Millionaire Maker?
What Is Delegated Proof Of Stake (DPoS)?
The simple explanation of DPoS is that you delegate your Tron to gain rewards, but you endorse a validator to create new blocks for the blockchain.
The Tron network only has 27 validators, referred to as Super Representatives (SR). They are elected by everyone participating in the Tron network using their TRX to vote.
The person with the highest amount of votes becomes a Super Representative and can then create blocks for the Tron network. When the blocks are complete, the SR's can choose to reward the people that voted for them.
Anyone open to voting but not elected is referred to as a candidate
It's a bit random because rewards can vary, and the Super Representative can elect not to offer rewards. It pays to do some research on SR's beforehand to see who's generous with TRX rewards and who isn't.
Tron has some unique features, one of which is freezing.
Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.
What Is Freezing?
When you first buy Tron, you cannot touch it for three days. When you freeze your TRX, there are several potential gains.
You can choose to freeze your Tron for Bandwidth Points (BP) or Energy Points (EP). For each TRX, you get 1 Tron Power, regardless of your choice. Tron power buys you voting rights.
Bandwidth Points (BP)
You can use Bandwidth Points to pay transaction fees instead of using TRX.
You get 5,000 BP for every day your TRX remains frozen. Freezing your TRX for BP means you can have more free transactions. How much BP you receive depends on how much TRX you have frozen.
Energy Points (EP)
You can use Energy Points (EP) to pay for smart contract interactions.
Freezing your TRX for EPs helps avoid additional fees for interacting with a smart contract such as TRC-20 tokens. How much EP you receive depends on the amount of TRX you have frozen.
For each TRX frozen, you receive 1 Tron power to vote on a candidate or super representative.
1 Tron power is equal to 1 vote. For instance, if you have 10 Tron, you would have ten votes.
You can vote for up to five SRs or candidates, choosing how you allocate your votes.
These people can then reward you with more TRX, but, as we've said before, choose your votes carefully as not all SR's or candidates offer rewards.
When the three days have passed, you can unfreeze your TRX if you wish. But, if you do, your votes are reset, which means you aren't eligible for future rewards. Any additional resources you earned during the three days are also reset.
Keeping your TRX frozen means rewards may be ongoing, and you can continue to vote.
How To Pay No Transaction Fees
You can send TRX to any Tron account, as long as your TRX isn't frozen.
For free transactions, use your Bandwidth points. One transaction uses about 250 – 300 Bandwith Points. It's a small amount, considering you receive 5000 BP per day from frozen TRX.
If you run out of BPs, simply freeze some TRX and gather more BPs.
If you have no Bandwidth Points, your transactions of Tron won't break the bank. You pay approximately 0.002 TRX per transaction, which is a tiny amount. In the early days of Bitcoin transactions, fees were very high, adding significant costs to the transaction.
Tron fees are more than reasonable for their high-speed transactions.
Check Out: 5 Reasons Why Tron Could Double Your Money
What Are Tron Tokens?
Tron has tokens that run on its blockchain, known as TRC-10 and TRC-20 tokens.
TRC-10 tokens don't use a smart contract for interactions, but TRC-20 tokens do, so you must pay additional fees for transactions with TRC-20 tokens. But you can use Energy Points (EP) to pay these fees. If you don't have enough EPs, freeze your TRX to earn some more.
Where Can I Stake My Tron?
Always choose the best place to stake Tron.
Make sure you find an established, reliable, and trusted company for your Tron stake.
With the emergence of new cryptos, many brokers aren't what they profess to be.
Here's a list of three trusted and recommended platforms where you can stake Tron –
- eToro – the eToro social platform makes it easy to stake Tron. eToro is an established, trusted broker. To earn staking rewards, simply buy Tron. They sort out the rest. eToro offers monthly rewards for Tron
- TrustWallet – Easy to set up staking options with a trusted crypto wallet
- Atomic Wallet– a cryptocurrency wallet offering 5% annual ROI
Should You Stake For Tron?
At the moment, Tron's price is $0.06791, so even if you bought 1,000 Tron, you'd spend less than $100. Imagine if you had bought 1,000 Bitcoin in 2009 when the price was less than a dollar.
You have to make your own mind up and, if you decide to buy Tron, consider it a long-term project for your stake. Choose the best place to stake Tron and earn TRX rewards.
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The Risks Of Staking
Over 71 billion Tron coins are in circulation out of a potential 100 billion.
Again, with Tron at such a low price, the risks are minimal. Find a trusted broker like eToro and let them do the work for you. Keep your risk to what you can afford.
You could lose money if Tron changed their rewards from 7% to a lower percentage.
There's always a risk of delisting coins, and if the coin platform holding your Tron stake is delisted, you will lose the money you staked.
When you know how to stake Tron and how easy it is to stake Tron, the rewards may outweigh the risks.
Only risk money you can afford to lose and that you don't need to get back any time soon.
A Stake Is A Belief
Tron is fast becoming of public interest.
As a relatively new blockchain, you can never assume future progress. But Tron is focused on growth and innovation.
Tron is a threat to centralised content sharing platforms, but that is unlikely to stop progress.
The public wants technological innovation. For instance, think back to the days before Amazon Echo's when we played CDs to listen to music. Now, we tell Alexa what music we want, and boom, music at our fingertips from a box smaller than a radio.
If you believe in technological advancement and trust that Tron is the platform to achieve that, then your belief has shifted into viewing Tron as a potential source of passive income from staking Tron.
If the price of Tron rises over the years, there could be much to gain and little to lose if buying Tron at today's prices.
The Key Takeaways Of How To Stake Tron
Tron is a growing blockchain with the technology for super-fast and low-cost transactions. You can earn around 7% yield per year and gain rewards from voting for Super representatives (SR) or candidates.
Not all SR's and candidates pay rewards.
To earn voting rights, your Tron has to be frozen. When buying Tron, it is automatically frozen for the first three days. During the freezing period, you can earn Bandwidth Points (BP) and Energy Points (EP), both of which you can use to pay transaction fees.
There are currently over 70 billion Tron in circulation.
Tron is one to watch but probably a long-term project rather than fast gains.
Please note that the above information is not providing advice on tax, investment, or financial services. We provide the above information without consideration for risk tolerance and a specific investor's financial circumstances.
Trading or investing in cryptocurrencies may not be suitable for all investors. It does involve risk and the possibility of a loss of capital.
eToro – Best Platform To Buy TRON
eToro have proven themselves trustworthy within the crypto industry over many years – we recommend you try them out.
How much Tron do I need to stake?
It's entirely your choice. There are no minimum requirements for staking Tron. The more TRX you have frozen, the more votes you have and earn Bandwidth Points (BP) and Energy Points (EP) to pay for transaction fees.
How much can you earn by staking Tron?
By participating in the Tron network and voting, the potential for passive income is around 7% annually, less the Super Representatives' fees. There is no standard SR reward system as it depends on each SR's generosity.
What's the future of Tron?
Tron set themselves up for scalability.
The Tron price is currently low, but who knows how far the price could rise in the future. Bitcoin started from such humble beginnings but now appears antiquated in technology compared to emerging blockchains like Tron.
The impact on the climate for Bitcoin mining will, at some point, become a problem. Tron is already ahead of this problematic issue.
What is the risk of staking Tron?
Any form of investment is a risk. Tron was founded three years ago in 2018 and innovated for scalability, but no one can ever predict the future and what may happen to cryptocurrencies. The current low price makes it affordable without breaking the bank.
What's the benefit of staking Tron?
The main benefit is the rewards from the Super Representatives or candidates you voted for. They pay you in TRX, but make sure you know who you are voting for and if they offer rewards.
Is Tron staking profitable?
Yes. Buy or stake Tron with an established, trustworthy broker or an online crypto wallet. You will make profits from your stake with rewards.
What's the best place to stake Tron?
Always stake your Tron with a reliable broker, such as eToro, TrustWallet, or Atomic Wallet
Is it worth staking Tron?
That's a decision only you can make. If you receive regular TRX rewards and the price of Tron continues to rise, you may eventually make a profit from selling your Tron. With the price of Tron currently at $0.1053, you could be holding for a while.
What Makes Tron Unique?
Tron technology means that content creators can directly connect with their audience.
Think of all of the centralised online platforms for streaming apps or music where content creators have to give back part of their sales as commissions to the media platforms.
The potential benefits of Tron are that content prices may be lower for consumers. Hopefully, lower prices will balance out the current commission fees for content creators
As the entertainment sector becomes increasingly digitalised (even more so because of the Covid-19 pandemic when entertainers had little choice but to share their content online), Tron could be well-positioned for success with the application of its blockchain technology
How Many Tron (TRX) Coins are There in Circulation?
Tron has a total supply of over 100 billion tokens. Right now, there are 101.84B Tron coins in circulation.
15.75 billion Tron were allocated to private investors, and 40 billion was available for the initial coin offering (IPO). 34 billion went to the Tron Foundation, and 10 billion went to a separate company owned by Justine Sun.
Effectively, Justin Sun, CEO of Tron, owns 45% of the TRX supply, a somewhat weighted percentage compared to other cryptocurrency projects.