- USDT becomes the most dominant cryptocurrency by demand and activity in the Tron ecosystem.
- Tension rises among traders as USDT pushes closer to the key support level but will it hold?
Demand for cryptocurrencies has fueled robust utility for most top blockchains, stablecoins account for most of the on-chain transactions. Tron has been at the forefront taping into the market’s huge stablecoin appetite.
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USDT on the Tron is like a match made in heaven. This is because the Tether-issued stablecoin accounts for the bulk of stablecoin volumes on the Tron network. According to a Pundi X Labs analysis, TRX transactions going through Tron grew by 47% in the last 4 months.
1/ 🧵 📈 We’re witnessing a notable surge, a 47% increase for the past 4 months, in transactions with USDT on the TRON blockchain via merchants using #PundiX XPOS.
This trend underscores the growing adoption of stablecoins on the TRON ecosystem among physical retail outlets. pic.twitter.com/GqZGjIwqdr
— Pundi X Labs | We’re Hiring (@PundiXLabs) August 16, 2023
The same analysis revealed that USDT managed to secure dominance as far as usage on the Tron network was concerned. It even managed to outshine Ethereum [ETH] which currently accounts for 43% of usage on Tron. The USDT stablecoin is the most dominant asset on the network at 48.6%.
Pundi X Labs mentioned lower fees and faster transactions as some of the key reasons for Tron’s stablecoin adoption. But just how much has this impacted Tron network fees?
Well, fees on the network have been averaging over $1 million for the last few months since February.
Source: DeFiLlama
For reference, the Tron network fees only briefly managed to push above the $500,000 mark at the height of the 2021 bull market. Note that this represents daily fees collected on the network.
TRX goes for a support line retest
Capitulation is the name of the game and that is exactly what transpired with TRX in the last few days. The bears regained control after TRX failed to rescue the price from the consolidation phase observed in the first half of August.
The price inched closer to its long-term support line after pushing as low as $0.075. Interaction with the support line will likely take place near the $0.073 price level.
Source: TradingView
Will TRX bounce back after interacting with support or will it extend its bearish trajectory? Investor sentiment has reverted to indicate bearish expectations.
However, traders should take note of whale activity. The supply held by top addresses remained flat, hence whales are not contributing to sell or buy pressure.
Source: Santiment
Read about Tron (TRX) price prediction for 2023/2024
As the world ponders upon TRX’s fate, perhaps we can look into its counterpart Bitcoin [BTC] which recently broke below its support.
TRX could follow a similar path but it is also rapidly approaching oversold territory. Traders should thus, keep an eye out for signs of strong accumulation which could put TRX back on a bullish trajectory.
