16:10 09.10.2019

TRON and EOS are Leaders by the Transactions Number, but Why Isn’t It Scary for Ethereum?

Ethereum was called the second generation cryptocurrency due to the ability to create dapps and smart contracts. But low scalability is an obstacle to the global implementation of this platform. As a result, Ethereum began to lose the battle over the number of transactions to more modern and scalable blockchain platforms.

Appearing in mid-2015, Ethereum was a breakthrough for the crypto industry, revealing new opportunities of blockchain and cryptocurrencies — smart contracts and DAPPs. Any developer can create a decentralized application, which does not fall under state regulation, so cannot be limited in use, on the mentioned blockchain from now on.

However, this blockchain platform still has the same problems as Bitcoin — low bandwidth and scalability. The team knows this and, therefore, actively continues development, releasing new updates.

But in 2017, two new projects appeared immediately, which promised to eliminate these shortcomings. The EOS team claimed that their platform would be able to process millions of transactions per second, while TRON developers talked about several tens of thousands of transactions per second.

Both of these projects carried out ICOs, as a result of which EOS raised $4 billion, and TRON — $70 million. At the same time, both of these projects were initially based on the Ethereum blockchain, and only in June 2018, with a difference of several weeks, both projects launched their networks.

EOS was able to surpass Ethereum in the number of transactions in just two months after the mainnet, TRON did it in 4 months. This growth has become evidence of the programs that launched these projects to create decentralized applications on their platform.

So, EOS created a competition during which developers had to create a beneficial application on their network. A specially invited and independent jury evaluated the degree of usefulness and importance of the apps. The apps that took the first three places were awarded substantial cash compensation of $100,000, $50,000, and $25,000, respectively.

This competition provoked high excitement, and a lot of applications appeared on the platform that made tens and hundreds of thousands of transactions each day. As a result, at the time of summing up the results of the competition, the number of transactions in the EOS network reached its historical maximum — 11,5 million per day.

But after three months, the excitement subsided, and the number of transactions decreased to 2,5 million per day. Since then, this number has been steadily declining. As a result, EOS has lost the leading position in this indicator to its competitor - the TRON network, leaving many inactive applications after the competition.

TRON leadership followed a similar strategy. Immediately after the launch of the network, the team announced that it would strongly encourage developers to create DAPPs on their web. The result was not long in coming: in October 2018, TRON surpassed Ethereum in the number of transactions, and already in December 2018, their number exceeded 3 million per day.

Justin Sun, CEO of TRON, is known for his PR companies, as a result of which we often observe price changes after some of his statements and actions. So, after the announcement of the launch of IEO BitTorrent (a company owned by TRON) and information about the airdrop of BTT tokens when storing TRON coins, their price increased. At the same time, the number of daily transactions has increased almost in 2 times and reached a new historical maximum.

A similar situation was observed at the end of July when a dinner meeting was scheduled between Justin Sun and Warren Buffet, a well-known opponent of cryptocurrencies. We saw a sharp jump in the number of daily transactions, which later returned to its original values. Recall that the meeting between them did not take place.

As we can see, Ethereum competitors are pleased with the significant changes in the number of daily transactions, which also indicates a higher throughput of competitor networks. Also, this may mean that new blockchain platforms are still in demand only when companies hold some promotions and incentives; in this case, we see a significant superiority of competitors.

If you look at Ethereum, then even such a significant event as the Constantinople update could not somehow significantly affect the daily number of transactions.

Nevertheless, there are 3 arguments in favor of Ethereum.

The first one is related to the quality of the created DAPPs on EOS and TRON because the vast majority of them are casinos and bets, which can hardly be called useful. For example, the TronBet application generates more than 500,000 transactions per day, which is more than the number of transactions on the Ethereum blockchain.

The second strong point is the fact that most new projects, ICOs, IEOs go exactly to Ethereum, which has already created a lot of huge crypto projects, such as Chainlink, BAT, and ZRX and others. Among the large projects on the TRON blockchain, only BitTorrent and Wink (whose capitalization is $ 94 million and $ 30 million, respectively) can be distinguished, while EOS has Everipedia, which raised $ 100 million, and currently has a capitalization of $ 10 million.

And the last, third argument, is the fact that many researchers have proved that most transactions in EOS and TRON networks are carried out by bots. Therefore, the popularity of these blockchain platforms is exaggerated, and they do not have mass distribution at the moment.

Thus, the number of transactions is not the only indicator by which we can judge the popularity of certain project. You should pay attention to the features of each blockchain networks to evaluate its functioning.

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