Research Summary
The report discusses the potential of TRON (TRX), a blockchain platform that has become a major hub for stablecoin activity, particularly Tether (USDT). It highlights TRON’s growing transaction volume, the increase in wallets holding USDT on TRON, and the platform’s potential as a global settlement network. The report also discusses stUSDT, a Real World Asset market built on TRON, and the TRX token’s supply dynamics and deflationary state due to network usage and growth.
Key Takeaways
TRON’s Dominance in Stablecoin Activity
- TRON’s Stablecoin Activity: The report reveals that TRON has become the most heavily used blockchain for stablecoin activity, with over half of all USDT supply sitting on TRON. It now settles around ~$70bn of weekly on-chain stablecoin volume, surpassing Ethereum.
- Increasing Wallets Holding USDT: The number of wallets holding USDT on TRON has increased roughly 2x year-to-date, growing from ~16m to ~32m. This indicates a widespread distribution and usage of USDT on TRON.
TRON as a Global Settlement Network
- Global Settlement Network: With its significant stablecoin activity and transactional activity, TRON is positioned as a potential global network for the settlement of offshore dollars.
Introduction of stUSDT and its Impact
- Launch of stUSDT: stUSDT was launched in July 2023 as a Real World Asset market built on TRON. Users can stake USDT for stUSDT and receive rebasing rewards. While stUSDT does not directly accrue value to TRX, it provides a reason for USDT to stay within the ecosystem.
TRX Token Dynamics
- TRX Supply Dynamics: The report highlights that the growth in USDT usage is directly driving positive supply dynamics for the TRX token. More usage of the network leads to more TRX needing to be bought and burned on a short-term basis and bought and staked on a long-term basis.
- TRX Deflation: Both network usage and growth have translated into consistent fees for the TRX network and a persistent state of deflation for the TRX token as demand for Energy outweighs supply.
Actionable Insights
- Investigate the Potential of TRON: Given TRON’s dominance in stablecoin activity and its potential as a global settlement network, it may be worth exploring the platform’s capabilities and potential for future growth.
- Consider the Impact of stUSDT: The introduction of stUSDT on TRON could have significant implications for the platform’s ecosystem. Understanding its impact could provide insights into TRON’s future trajectory.
- Understand TRX Token Dynamics: The supply dynamics and deflationary state of the TRX token could have significant implications for its value. Understanding these dynamics could provide valuable insights for those interested in the TRON platform.
