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- 1 SixDegree has recently submitted its research, which confirmed that in 2023, some stablecoins did not experience a significant rise in value despite the ongoing bull trend in the crypto market.
- 2 In 2023, the Tron stablecoin price rose by 57.7%, while the Ethereum stablecoin plummeted by 34%.
- 3 At press time, the total value of stablecoins is $129.5 Billion, whereas it was $139 Billion in December 2022; that marked a decrease of $9.5 Billion.
The TRON network strived to improve the decentralization of the internet, utilizing blockchain technology and dApps (decentralized applications). Furthermore, as per the sources, the core founder of Tron Network is H.E. Justin Sun. The Tron network was founded in September 2017 and in May 2018, it embarked its mainnet.
In contrast, Ethereum is one of the most widely appreciated blockchain based impressive software platforms.
Performance Comparison of Ethereum and Tron
Both Ethereum and Tron are two of the major blockchain platforms that have witnessed different growth movements in their stablecoins due to the developments in their respective networks and platforms.
Ethereum has undergone a consequential drop of 34% in the value of its stablecoin, which is very distinguished compared to other platforms. The current value of the platform has dropped to $69.4 Bilion in a year.
On the flip side, the stablecoin on the Tron network has noticed a gain of 57.7% in the same period.
To understand this drop in the value of Ethereum’s stablecoin, it is crucial to understand the market dynamics of the stablecoin and the various allocation models of these digital assets to observe some interesting patterns.
50% (half) of the stablecoins on Ethereum are held in the personal wallets of users. While the other 30% of stablecoins are held in centralized exchanges (CEXs), a small amount of 5.5% is held in decentralized finance (DeFi) protocols.
It recorded a significant decline from the high marked in January 2022, when DeFi protocols held about 25% of Ethereum’s stablecoins. Which is now just 5.5%. The three major leading stablecoins on the Ethereum network are USDT, USDC, and DAI. All of these stablecoins have glimpsed very different tendencies during this period.
More than 30% of Tron’s stablecoins are in centralized exchanges, just 0.2% are in DeFi protocols, and a large chunk of about 70% are held in personal wallets.
TRON’s Stablecoins Market Growth in 2023
Stablecoins on the TRON network have witnessed a remarkable growth in its value in 2023, which can be explained by various factors.
One of the main factors that might have contributed to the considerable growth of Tron is the expansion of the user base in the first two quarters of 2023. Moreover, the user base for the Tron network boosted by about 40%, which resulted in an increase in the number of weekly stablecoin users to 5 Million.
This expansion of the user base led to an increase in transaction volumes, which reached $70 Billion every week.
The increase in value of TRON’s stablecoins was especially notable in emerging markets, including Latin American countries, where TRON’s low transaction fees and high transaction speeds are very attractive, especially in regions/ countries with high inflation rates like Argentina.
With this notable growth, TRON has become a major player in the DeFi and stablecoin sectors, with over $8 Billion in its ecosystem. It has also seen a considerable rise in the issuance of stablecoins.
In conclusion, it can be said that there are advantages and disadvantages to using TRON stablecoins, such as lower transaction fees. It has also drawn more users to the Tron network. All these helped TRON in becoming the leading blockchain for stablecoin transfers.
Disclaimer
The views and opinions stated by the author, or any people named in this article, are for informational purposes only. They do not establish financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss.
Adarsh Singh is a true connoisseur of Defi and Blockchain technologies, who left his job at a “Big 4” multinational finance firm to pursue crypto and NFT trading full-time. He has a strong background in finance, with MBA from a prestigious B-school. He delves deep into these innovative fields, unraveling their intricacies. Uncovering hidden gems, be it coins, tokens or NFTs, is his expertise. NFTs drive deep interest for him, and his creative analysis of NFTs opens up engaging narratives. He strives to bring decentralized digital assets accessible to the masses.
