Editors Note: This article comes fromHoneycomb Finance NewsEditors Note: This article comes from
Honeycomb Finance News
(ID: fengchao-caijing), author Wu Xusheng, reproduced by Odaily with authorization.
In the early hours of March 5, Justin Sun, the founder of TRON, announced on Twitter that the TRON Foundation has reached a cooperation with Tether, the parent company of the stablecoin USDT. USDT will be listed on the TRON public chain early in the second quarter of 2019.
Immediately afterwards, Tether officially confirmed the cooperation. According to official sources, USDT based on the TRC20 standard will be generated and circulated in the TRON network in the future.
One side is a public chain that is constantly moving, and the other side is a giant in the stablecoin market. The marriage of the two parties is for a win-win situation, and they are also trying to expand the shortcomings of their respective layouts.
The rapidly advancing TRON needs more products with self-contained users to enter the ecology, so as to continue to grab the market share of the public chain; the situation of USDT being the only one in the stable currency market has also quietly changed, and TUSD and PAX are eroding USDT due to their compliance features territory.
TRON and Tether hit it off right away, and the two sides happily reached a cooperation. Under the surface of a win-win situation, challenges such as technical compatibility and compliance are not small.
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After acquiring BTT (BitTorrent) in August last year, TRON released another big move yesterday: TRON Foundation reached a cooperation with Tether, the parent company of USDT, and Tether will issue USDT on the TRON public chain.
In the early morning of March 5th, Beijing time, Justin Sun, the founder of Tron, released the news of this cooperation on Twitter.
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Justin Sun said that the cooperation will make it easier for users to access the TRON blockchain
When everyone was still distinguishing the authenticity of the news, Tether officially confirmed that a statement of cooperation with TRON appeared on the official website. Tethers Chief Operating Officer Jean-Louis van der Velde also stated in the statement that the cooperation with Tron will provide users with another access point in the field of distributed financing to continuously meet the needs of the digital asset community.
TRON’s official announcement shows that it is expected that USDT based on the TRC20 protocol will be officially released in the early second quarter of this year.
The announcement also reveals the intention of TRON to issue USDT: USDT based on the TRC20 protocol of TRON can realize interoperability with decentralized applications based on the TRON protocol, and allow users to peg with fiat currency in the entire network of TRON Currency trading and exchange.
Founded in October 2014, Tethers core product is the stablecoin USDT issued based on the Bitcoin Omni protocol. In February 2015, USDT was registered on Bitfinex, the trading platform with the largest trading volume of Bitcoin at that time. The two companies have been understood as sister companies by the outside world because of the large overlap of team members.
When stablecoins had not yet become a trend, this token, which was originally exchanged 1:1 with the U.S. dollar, was once regarded as a hard currency by the market, dominating one side of the cryptocurrency market. According to Feixiaohao data, on March 5, the USDT circulation market value was 13.6 billion yuan, ranking seventh in the global cryptocurrency circulation market value.
After the high-profile official announcement of the cooperation between the two parties, Tron TRX quoted 0.152 yuan, an increase of about 7% in less than 24 hours after the news was released.
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TRON Makes Up for the Stablecoin Layout Gap
In the deep waters of the bear market where the cryptocurrency market is sluggish and users keep leaving the market, Tron is going upstream in the entire public chain market. Under the current situation of lack of users, TRON adopts the strategy of introducing products with its own users to enter the community. Last year, it acquired BitTorrent, which has a huge number of users, which also confirms this point from the side.
If there are no users, I will buy users. Someone once commented on TRON. After the acquisition of BitTorrent, TRON issued BTT. After the public sale on the Binance Launchpad platform, the currency was listed on major exchanges one after another, and the price of the currency soared 10 times.
Just two days before the cooperation with Tether was reached, Justin Sun posted a report on Weibo saying that the total number of TRON users exceeded 2 million. It took 181 days for the first 1 million, and 68 days for the second 1 million. .” On March 5, TRON’s official website showed that its user base was approximately 2.01 million, an increase of nearly 10,000 in the past two days.
In addition, the daily transaction volume of TRON DApp has also surpassed the long-standing target Ethereum. According to the DappReview website, the daily transaction volume of Tron is 160 million yuan, and that of Ethereum is just over 100 million yuan. The daily activity of 60,000 people is also much higher than the 14,000 people in Ethereum.
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The DappReview website shows that Tron’s daily transaction volume is 160 million yuan
Tron, which has been competing with Ethereum in the public chain market, has been making great strides all the way, but there is a gap in the layout of stable coins.
Last year, stablecoins became a hot topic in the industry. The new generation of stablecoins such as TrueUSD (TUSD), Circle Coin (USDC), Gemini Dollar (GUSD), and Paxos (PAX) competed with Tether (USDT). They are all based on the Ethereum network issued.
Using USDC as an example, the Coinbase team explained the benefits of stablecoin issuance based on Ethereum, Improved sending and receiving. Two Ethereum wallets can quickly send and receive any amount of USDC at any time of the day. For business Large transfers to destinations become as easy as small e-commerce payments.
Undoubtedly, stable currency is a big market, and TRON has always been blank in this field. In addition, the public chain preempts the layout of stable coins, and also provides a currency that balances the risk of market fluctuations for future decentralized trading applications. The access to this infrastructure will also bring more application scenarios.
This time, TRON also bluntly stated that the issuance of USDT based on the TRC20 protocol can open up a channel with decentralized applications in the TRON ecosystem, and also provide TRX with a fiat currency entry in the transaction scenario.
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USDT breaks through again with the help of wave field
Since March 2018, various stablecoins such as PAX, USD, and DAI have been listed one after another. In particular, PAX, according to Feixiaohao, had a circulating market value of approximately 730 million on March 5, making it one of the top 50 cryptocurrencies in the world, with a high degree of market recognition.
Even Zhao Changpeng, the CEO of Binance, once called out for PAX, If you are worried, you can learn about the regulated stable currency PAX.
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PAX rises strongly
Not to mention homogeneous competition, recently, there has been news in the market that Facebook will also issue its own stable currency. If the rumors of Facebook issuing currency come true, the life of USDT may be even more difficult. After all, USDT, whose circulation market value is only 2 billion US dollars, cannot be compared with the market value of more than 400 billion US dollars of the social behemoth Facebook.
In addition to external competition, USDT itself does not live up to expectations. In October last year, USDT decoupled from the U.S. dollar price and plummeted by 7%. The phenomenon of stable currency instability once again aroused the markets suspicion of this hard currency.
Tether, facing internal and external troubles, needs to find new growth points, which may be one of the reasons why it cooperates with Tron.
The marriage with Tron is not the first contact between Tether and the public chain. At the beginning of 2018, Tether announced that it would issue USDT based on the ERC20 standard on Ethereum, which is equivalent to the USDT previously issued based on the Bitcoin Omni protocol.
At that time, the reason given by Tether was that the fee was low and the transaction speed was fast when the protocol was changed to issue USDT. Since the initial USDT is issued based on the Bitcoin network, each transaction needs to spend BTC as a network fee, and the transfer speed is relatively slow, usually more than half an hour to complete the confirmation. ERC20 USDT transaction confirmation time is reduced to 15-30 seconds.
After Ethereum issued USDT, Tether said that it will also launch USDT based on the Litecoin network, Trezor and Lightning Network.
TRON, which is benchmarked against Ethereum, has always shown its superiority in performance. Sun Yuchen also used this to interact with V God, the founder of Ethereum. The comparison of Tron 10,000 TPS, Ethereum 25 TPS; Tron zero handling fee, Ethereums high handling fee was also shown off by him many times.
Reducing transaction fees and increasing transaction speed may be another public chain experiment for Tether to issue USDT on the TRON public chain.
However, the Ethereum version of USDT that is compatible with the Omni protocol has also experienced some technical problems. Netizen Ashton reflected in the short book that Ethereum’s USDT did not fully follow the ERC20 standard. “The company has a business that requires users to transfer the ERC20 version of USDT to an contract, and when certain conditions are met, the transferred USDT will be transferred back to the user through the contract.” When the test user transferred USDT into the contract and waited to transfer out, he found that the transferred USDT could not be transferred out.
It seems that Tether, which will issue USDT on the TRON protocol in the future, will also face technical challenges. In the eyes of some industry insiders, this cooperation is not reliable. A founder of a public chain project told Honeycomb Finance, It feels a bit nonsense. Doesn’t TRON often roll back transactions, and is not optimistic about TRON’s technology. Technical problems can be solved, but it is not easy to change the existing status of some industries.
