Key Insights:
Justin Sun has announced Tron would make USDT payments gas-free next week.
The feature is expected to roll-out to Ethereum and eventually to all other blockchains.
Last year, Tron had the second-highest revenue at $2.1 billion among all blockchains, coming second only to Ethereum's $2.5 billion.
Sun has also played a key role in establishing a pro-crypto policy in the USA and has business ties with the Trump family. He bought $30 million worth of WLFI tokens last year.
Justin Sun announced that starting next week, Tron would facilitate the gas-free transfers of USDT on the Tron Blockchain. An expected roll-out is also expected for Ethereum. According to Sun, this development will encourage large corporations to adopt stablecoins.
The plan is to eventually roll this out on most of the EVM-based blockchains. The EVM is the virtual machine that powers several blockchains, such as Ethereum, Tron, BNB Chain, and all the layer-2 networks.
Throughout the world, stablecoins are extensively used for making cross-border payments and have been a preferred method of payment in the crypto world. They have shrunk cross-border settlement periods from three days to just a few seconds.
Stablecoins also act as a major liquidity medium for DeFi markets and practically make it possible for users to trade in DeFi.
At present, Tron is the second largest blockchain in terms of on-chain stablecoin reserves and is extensively used throughout the crypto ecosystem as a cheaper alternative chain for USDT transfers. At press time, Tron hosts around $62 billion worth of USDT while Ethereum is a little ahead at $75 billion.
Top 5 Blockchain in Terms of Net Stablecoin Reserves
DeFi Llama
The reduction of gas fee to zero is expected to create a major spike in the USDT trading volumes on Tron and as a result, it might beat Ethereum in the short term in terms of net on-chain stablecoin reserves.
This latest development could also lift Tron's native token, the TRX which has been struggling at $0.22. A lift in its price could lead to a rally to $0.44.
Lately, Tron has created another stablecoin called the USDD 2.0 which offered 20% APY.
Yes, in the short-term Tron is expected to lose in terms of fees. Most activity on the Tron blockchain in the present time originates from stablecoin transfers. In 2024, Tron earned around $2.1 billion in fees, only second to Ethereum which earned $2.5 billion.
Tron Beats Most Chains in Fee Earned in 2024
CoinGecko
However, this could turn much more profitable in the long-term. If Tron establishes itself as a top blockhain for stablecoins, it would mean that it becomes a natural choice for DeFi.
Further, the FUD around Ethereum has already spooked many ETH investors and this could benefit Tron as the second logical choice. If you are thinking about Solana, you would be surprised to know that liquidity on Solana($11.5 billion) is just a fraction of what it is in Tron($62 billion). Further, Solana has very negligible USDT reserves and most stablecoins on Solana are USDCs.
Sun has been lately acting very bold in terms of investment decisions, business policy changes and in his overall strategy. Last year, he made a 30 million dollar investment into the Trump family's DeFi protocol World Liberty Financial.
At press time, his investment is expected to have tripled to more than $90 million as WLFI's token has gone up from $0.015 to $0.05 at press time.
Further, DSA, an entity by Justin Sun had backed Trump's Inaugural Event as he became the US President. Sun, Musk and Garlinghouse seems to have played a crucial role in directing the pro-crypto policy of the US government.
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