Tron is another cryptocurrency I see that's on its way to zero, and one I doubt will be a very good investment, because it's basically an Ethereum copy. It's Justin Sun's version of Ethereum. At this point, there are so many other Ethereum copies, there's heavy competition, and there's better technology now. So I want to tell you why I think Tron is not going to have a very bright future. I'll also tell you some of the things I do like about it, and compare it with Internet Computer Protocol, which to me is the best technology by far in crypto.
Tron's price chart and market cap
If we start with the price chart, which is what most people want to get into first, Tron is up about 100% or so over the last year, which is in line with things like Bitcoin, Ethereum, and Internet Computer. However, it has not reached its all-time high from 2018, right during its first bull market. Tron's last bull market did not even get back up to its first bull market high, and things that generally don't age well in crypto are altcoins.
That said, Tron is definitely a little unusual, because most crypto altcoins do not have this consistent, steady up-and-to-the-right price chart. This is the kind of price chart most people like to buy on. But I doubt there are going to be very good returns for Tron going forward, because of the things I'm about to lay out.
First off, Tron already has a fully diluted market cap of about $10 billion, which is double where Internet Computer is at today. That leaves me thinking that if you compare the two, Internet Computer is so far superior as an investment that there's no way I'd want to have any money in Tron.
The numbers look impressive at first
If you go down and learn more about Tron, at first you'll be impressed with the sheer quantity of the numbers. Tron has millions of followers on their main account. They got a collaboration between Hans Zimmer and Justin Sun, the Tron founder, for the Tron Anthem. The branding behind Tron is pretty good. And if you go to the explorer on Tron, they say they have 200 million accounts, which is one of the biggest in crypto, and billions of transactions, including millions in the last 24 hours, with about 100 transactions per second and a maximum of about 1,000.
One of the most positive things people who like Tron will point out is their $21 billion in total value locked. There's a lot of Tether USDT circulating on Tron right now, much bigger than most other cryptos outside of Ethereum, BNB, and maybe Solana in some instances. So Tron has comparable numbers to some of the biggest cryptos, but it's already valued pretty close to those as well. It's not like it's drastically undervalued.
Actually using Tron is not the best experience
Now, I have actually used Tron in several different contexts over the years, and what I can say is that there are much better things on the market today. When I used Tron on my Tangem wallet, I used USDT on Tron, and I had to buy some TRX and send it to my Tangem wallet just to be able to send the USDT on Tron, which was really annoying.
There are things like minimum balances, and how nice is it to have to hold two different tokens? If you want to use USDT, you also need TRX. While that does sound good in terms of purely earning the protocol revenue, it's bad for mass adoption, because you want something people can use without even realizing it's crypto. If you're using USDT on Tron and you have to buy TRX just to send it, then you very much know that you're buying and sending crypto, and that leaves the door open to a far superior business system.
Why the ICP wallet experience blows Tron away
If you want a far superior business system, look at Internet Computer Protocol. You can sign up for an application like OpenChat, which is hosted 100% on chain, and the wallet experience is far superior to using Tron. If you're on jerrybanfield.com, you don't even realize it, but you just generated a transaction on Internet Computer Protocol, which is doing four or five times the amount of transactions per second that Tron's max capacity is, and that's nowhere near the max capacity of Internet Computer. These transactions are equivalent to hundreds of thousands of ETH transactions.
So consider the raw computation power of ICP versus Tron, when ICP's market cap is half of Tron's. ICP absolutely blows Tron out of the water. Technologically, Tron is basically a copy of Ethereum, and copies tend not to be valued as much as the original and don't have the network effect. Tron does have a nice network effect from the amount of transactions, but the underlying technology is not the differentiator.
On ICP, I can send CKUSDC instantaneously. I can swap it, I can send it to somebody, and I don't have to pay any fees. I can send it to anybody in my OpenChat. There's only a fee of about one cent added to send it, which is actually higher than a lot of other fees on ICP, and it's practically instantaneous. I don't need any ICP to send that transaction. Compare that to Tron, where you have to hold TRX just to send a USDC or USDT transaction. All of this on ICP is directly on chain and accountable, and everybody can actually see the transaction in my OpenChat. This is a far superior experience to Tron, and a far superior experience is going to win over time.
This is the kind of side-by-side altcoin research I share live with the Jerry Banfield Family, and it's also the heart of why I believe when Ethereum DeFi collapses the money will flow into ICP rather than into Ethereum copies like Tron.
Tron and gambling in Asia
One of the main things Tron seems to be used for is gambling in Asia. Almost all I hear, when people talk about Tron, is that people use it to gamble in Asia. It's interesting, because if you look at the Tron explorer or the Tron website, on the surface you don't see any mention of gambling. There's Justin Sun's profile, it sends you to an exchange, but you don't see any mention of gambling, yet it seems to be one of the main things Tron is used for.
So this comes back to: why would people want to gamble on Tron instead of gambling somewhere else? I imagine there's no better option in some places, but that's only because people don't know about Internet Computer. On Tron, the way the whole infrastructure works is fundamentally the same as Ethereum. There aren't websites hosted on Tron. The NFTs are not hosted directly on chain. That means if you're trying to gamble on Tron, all the stuff that really matters is off chain. You can deposit Tron to a gambling website, but then it's all off chain.
My own experience with gambling, and why off-chain gambling is rigged
Now, I'm a person who's had gambling addiction issues, who qualifies for Gamblers Anonymous. It has been years since I've placed a bet, for which I'm very grateful, so let me mention that in the context of this gambling discussion.
On Tron, you can send money to gamble and put it on a website, but then it's all off chain. From my experience gambling online, you don't want to gamble somewhere off chain, because you don't know if it's fair or rigged. In my experience gambling online, people cheat. You get on a poker table, a friend and the two of you play the table together, and you're either cheating or you're getting cheated. Even if you're cheating, you might be getting cheated by somebody else cheating better. Unless you're playing one-on-one heads-up against somebody, which I did a lot of, you're getting cheated.
So the only way right now that we can have truly transparent gambling is the gambling websites that are being built and are live on Internet Computer Protocol. Since it's fully on chain, you can prove it's fair, and you can have real ownership by a DAO. To me, that puts Tron in trouble. There's superior technology out there. There's fully on-chain gambling that's out there. There are gambling tokens looking to launch on Internet Computer Protocol, and I've talked to some of their founders, because it's the best tech and there's the most growth. If you can build your entire gambling website on ICP, then it's also decentralized, which makes it easier to not get shut down.
So one of the main things generating a lot of the transactions on Tron is gambling, and to me the future of that is limited. I know a lot of people who gamble are very habitual and will keep gambling where they've always gambled, but the places that are going to be new and attractive and pull users away are going to be things like fully on-chain gambling, and that can really only happen on ICP. The same goes for stablecoins. ICP has a far superior infrastructure for stablecoins than Tether on Tron. Once you use the ICP wallet, once you make transactions on something like OpenChat, there's no reason to use Tron again.
Marketing always loses to superior technology
Now, Tron has a great hold on the Asian market currently, but what we want to look at in investing is where things are going in the future. Are things trending toward Tron having better growth than something like ICP? To me, no, they don't look like it.
Someone summarized this well while I was live: Tron hasn't achieved any additional technical advancement compared to existing coins. Tron only launched because Justin Sun didn't like Vitalik Buterin. It's failed to compete against Ethereum, and this is a coin primarily based on marketing. Marketing will always fail over time in the face of superior technology, because it doesn't drive lasting end-user adoption. It doesn't matter, for example, how much you market MySpace; if it can't organically grow, it's finished.
If you want more of my honest, real-time coin breakdowns like this one, I keep them all in my Money playlist.
Paid partnerships and the Justin Sun problem
Here's another big problem I see with Tron. Tron has some great partnerships and lots of value locked, but what are these worth? I would imagine Justin Sun has just paid some of these projects to promote with Tron. I imagine he paid Hans Zimmer a good amount to do this Tron video. But at some point your money runs out too, when people quit buying your crypto, and it comes back to: are people going to organically build on Tron?
One of the biggest problems I see with Tron, in addition to the technology, is Justin Sun himself. Justin Sun is a very controversial founder who really aggravates some people, which is why you don't even see Tron talked about that much in crypto. At the same time, Justin Sun is very effective at marketing. But as we can see with things like Richard Heart with Hex, marketing runs out when there's no real foundation at some point. Justin Sun does have a real foundation with Tron, but that foundation will continue to get shakier over time as the technology gets older and less relevant, while older technology like Ethereum already has a much bigger network adoption.
"Decentralizing the web" is a false narrative
One of the things I really don't like about Tron, besides Justin Sun, is the question of who's actually involved in this. It's not even easy to find. I searched "Tron Foundation" on Google, and I see something from Wikipedia, but what I don't see is a Tron website. So you've got this narrative of Tron decentralizing the web, but to me this is a fraudulent narrative. Tron is not decentralizing the web, because Tron cannot host websites.
If you want to truly decentralize the web, you need to be able to put entire websites, protocols, pictures, NFTs, and videos on chain. Where's the only place you can put all that stuff on chain? Internet Computer Protocol. You cannot put that stuff on any other chain. On Tron, this "decentralize the web" story is all centralized websites. When you use Tron, the blockchain itself doesn't even seem decentralized. It seems like if Justin Sun wants something to happen, it happens.
What Justin Sun did to Steemit
You can see how important it is to have true decentralization. Justin Sun decided he wanted a social media platform, and he came in and bought Steemit Inc., which was all hyped up and had this great pump. I got sucked into it, promoted it, and went all in on it, because I didn't do my research well enough and think about the tech in the big picture. Justin Sun bought Steemit and ruined it. Steemit absolutely crashed and went to zero.
We got to see how decentralized Steemit really was when Justin Sun bought it. It seemed like decentralized social media, but when Justin Sun bought it, he took over all the witness positions. He was able to do whatever he wanted with this so-called decentralized social media platform, and he killed Steemit. It just has sucked since then. I firsthand have seen what happens when Justin Sun comes in and takes something over, and that does not give me confidence in the future.
Who is actually building Tron?
The lack of transparency about who's actually working on Tron leaves me thinking there's not a lot of actual engineering work getting done on Tron. You might take that for granted in crypto, but I don't.
The DFINITY Foundation is the major contributor to Internet Computer. They launched Internet Computer. They have the largest research and development team in blockchain, with employees who hold hundreds of patents and hundreds of thousands of citations, and this is the most impressive team I've ever seen in crypto. They make advances on the technology behind the Internet Computer every day. They put out videos. Mary did a talk about verified credentials, which she actually worked on, and then she presented that on the DFINITY channel. I've watched videos of the tech that these people have actually worked on, and the Internet Computer's technology is rapidly advancing and leaving everything else behind in crypto.
That means something like Tron, which technologically is not advancing, is going to be left behind. It has a lot of adoption in Asia right now, but that's only because people don't know about Internet Computer, both end users and developers.
ICP is laying foundations in Asia
Internet Computer is laying really strong foundations right now in Asia. If you look at what the ICP hubs are doing in Asia, they have entire countries like Thailand and Indonesia where there are all these emerging developers, and Tron's not in there. Tron's not presenting at universities. Internet Computer is, and in many places Internet Computer is the only blockchain that's presented at that university. Some of these ICP hubs have relationships with all the major universities, or most of them, in the entire country.
So I'm looking toward the future and asking: is Tron going to do better than ICP? Because the only reason you would diversify is because you can't effectively research. Tron definitely looks like it's done better so far, at least in price, than a lot of other cryptos. But we've seen cryptos that are extremely centralized around one person, and we've seen the legal troubles Justin Sun has already had.
A house of cards built on one man
If you look at Justin Sun, he's had one thing after another. There's an article that says Justin Sun's empire may be on the verge of collapse. If Justin Sun's empire collapses, it's going to be like when Richard Heart goes down and Hex goes down 98% or whatever within a year or so. This is all a house of cards built on Justin Sun, and his exchange, and there are so many avenues where there could be a problem, because it's all built on Justin Sun and not built on technology.
Internet Computer Protocol is built on technology. The individual people, to some degree, don't matter that much, because there's a huge team and real tech you can actually use. Tron, to me, is a house of cards that could come down with Justin Sun, and that makes it way too risky. This could easily end up going from 12 cents to 1 cent if something happens with Justin Sun or his empire collapses.
This is exactly the kind of single-founder, marketing-over-technology risk I wrote about in my review of why I believe Cronos CRO and Crypto.com are going to zero, and it's a pattern I keep seeing across these centralized altcoins, like in why I think Aave is heading toward zero.
Why I wouldn't hold any Tron
Tron could trend up a bit more over time. I would actually think Tron, in many cases, would do better than a lot of other altcoins, because it does have a lot of significant adoption. But this is not something I would want to hold, for the reasons I've given you. The number one reason is that the technology behind Tron does not appear to be making any meaningful advancements.
While Bitcoin hasn't made hardly any meaningful advancements, and Ethereum's advancements are slow, the true competitors to Bitcoin and Ethereum are going to have to have gigantic technological advancement in terms of on-chain computation, meaning what you can actually do directly on the chain and what the protocol itself can do. I don't see something getting into the top three based just on marketing and network adoption, because the more educated people in crypto get, the more they're not going to just throw their money at coins and hope for the best. They're going to look for the best technology, the best team, and a protocol that's going to give them a long-term return.
So when you compare Tron to Internet Computer, to me it's just a no-brainer. There's no way I would want to hold any Tron, not even a little bit. The only reason I'd hold it would be in case I'm wrong about ICP, and this has way too many risks. I seriously doubt there's much upside here, based on what we've seen before.
Now, this could reach its previous bull market all-time high from 2018. It might go over 20-something cents. But Tron also seems to never really go that high either. It goes up some, but then, because it's so centralized, Justin Sun probably takes his profits as soon as he cashes out his next supply. So I doubt this is even going to go over maybe 20, 30, or 40 cents at the height of a bull run, and that's not the kind of return I'm looking for. This is the kind of research I'd love for you to bring me, and you can request a coin review or just talk it through with me any time inside the Jerry Banfield Family.