23 August 2024

As much as we fantasised about Bitcoin at $60,000 last year, we are certainly getting bored of it this year. The way crypto works psychologically is amazing.

As Bitcoin continues to hover around $60,000, its market dominance is now around 57%. Its been a rough ride for altcoins this month. There is one which has shown a strong resurgence – Tron. We cover Tron, TRX and its ecosystem in our Hot Take today.

Top-3 stories of the week:

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The newsletter is put together by Giottus Crypto Platform. You can read all the previous issues of Cryptogram here.

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WEEKLY MACROS

• Total crypto market cap - $2.16 trillion - UP  6.1%

• Bitcoin price - $60,906 - DOWN 0.3%

• The dollar index (DXY) - 101.34 - DOWN 1.7%

• Bitcoin Dominance - 56.82% -  DOWN 1%

• Crypto Fear and Greed Index - 34 - Market is in Fearful State

THE HOT TAKE

Tron’s meme resurgence is noteworthy

Even as Ethereum continues to grapple with sideway price action and continued net outflow for ETFs, Tron is emerging as a potential rival that could shake up the blockchain landscape. TRX, the native token of the Tron ecosystem, has entered the top-10 list this week following a 20% rally. It is now at 11^th , just behind Cardano (ADA).

Last week, Justin Sun, the founder of Tron took to X to share that Tron’s revenue was 50% higher than Ethereum’s in the past month. And if this trend persists, it has the potential to become the most profitable blockchain.

Let us cover key trends in this ecosystem.

Daily Revenue reaches new ATH

On August 20, Tron’s daily revenue reached a new all-time high of $3.84 million, driven by robust activity within its ecosystem, notably the SunPump memecoin generator. This impressive figure signifies strong user engagement and demand for Tron's resources.

For context, Tron has outpaced Ethereum, which reported $1.36 million, and Solana, at $541,000, in daily revenue. While the long-term implications remain to be seen, this surge in Tron's network activity indicates a growing interest in its capabilities and potential applications.

Decoding SunPump.meme

SunPump is a platform, similar to Pump.Fun (on Solana), that lets users create their own meme coins quickly and easily, without needing any technical knowledge. It's becoming a popular choice for launching memecoins.

To create a memecoin on SunPump, you pay a one-time fee of 20 TRX. When trading memecoins on the platform, there's a 1% fee.

After creating a memecoin on SunPump, you must ensure it reaches 100% of the binding curve. This ensures the token’s liquidity hits a decentralized exchange (DEX) on the Tron network. Once this happens, SunPump automatically adds about 100,000 TRX and 200 million tokens to the liquidity pool on SunSwap V2. Although SunPump adds liquidity to SunSwap, it also has partnerships with Poloniex and HTX exchanges, so some memecoins might appear there too.

Sun Pump is the major driver for TRX’s rally

Market analysts have attributed Tron's recent fee surge to the successful launch of the SunPump memecoin deployer on its network.

Since its debut, SunPump has generated over 11.14 million TRX in revenue, valued at approximately $1.73 million, according to Dune Analytics data. SunPump has been used to launch 1,949 tokens over a 24-hour period bringing the total to 27,000 coins, according to blockchain data from Dune.

This has led to the resumption of Memecoin Frenzy

Several memecoins launched on SunPump have made significant profits for early buyers. For example, one wallet, known as “TDm2” and tracked by the on-chain analytics tool Arkham, turned an initial $1,000 investment into $400,000 with the memecoin SUNWUKONG, inspired by the Chinese video game Black Myth: Wukong.

Another trader invested $1,690 in the memecoin SUNDOG and turned it into over $20 million in just six days. This trader now holds $19.5 million worth of SUNDOG across seven different wallets and has already transferred $1 million to exchanges, according to Arkham.

But why are memecoins booming on Tron?

The real power is the $61 billion in USDT, circulating on the Tron network. No other blockchain protocol can boast a liquidity pool this substantial. While Ethereum comes close, the heavy transaction fees dampen memecoin growth. In the world of memecoins, liquidity is king, and Tron has it in abundance.

Tron’s dominance is evident when comparing USDT circulation across networks. While Solana, a leading chain for memecoin activity, hosts around $1.9 billion in USDT, Tron dwarfs that figure. This overwhelming liquidity gives Tron a significant edge in the market.

Can Tron sustain its rally?

Tron has surged nearly 41% since its August 5, with a notable acceleration this Wednesday when the price reached $0.17. The last time TRX traded at this level was in May 2021, and briefly in 2018. Historically, this $0.16 zone has been a point of turbulence for the coin, with extended periods of consolidation.

Given this, a short-term correction seems likely. Supporting this outlook is the overbought RSI, which has climbed above 90 on the daily chart—often a precursor to pullbacks. Additionally, the broader crypto market is showing signs of caution, further suggesting a potential retracement in the near term.

Memecoins are known for being even more volatile. Their value can soar in one hour and plummet the next. Additionally, the risk of fraud can arise at any stage of a memecoin project's life that can lead to losing 100% of the invested value.

With so many new memecoins flooding the market daily, it's nearly impossible to monitor them all. That's why we reiterate to Do Your Own Research (DYOR) and tread cautiously.

Key Takeaway

Indians love Tron and TRX. Using the blockchain is fast, easy and cheap. In fact, on Giottus, TRX withdrawals carry zero fees.

TRX doing well is a good sign. Often we see that memecoin creation are rotated around blockchains. From Ethereum to Solana to Base to now Tron. We hope that Tron continues to rediscover its mojo and maintains a spot among top-10 crypto assets.

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If you have any questions or feedback for us, write to us at [email protected]. You can check out the previous issues here.

Disclaimer: Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Please do your own research before investing and seek independent legal/financial advice if you are unsure about the investments.