Tron Founder Justin Sun tweeted earlier today that TRON (TRX) is now the second most used protocol for DApps, though Ethereum retains the first spot. It is based on an annual report by DApps information aggregator and analytics website dapp.com for the year 2019, as cited by the Tron foundation on Twitter. So how true is it and is there another side to this story?
#TRON is now the second most used protocol for #Dapps (Decentralized applications) after #Ethereum. https://t.co/smN3SgO6F9— Justin Sun (@justinsuntron) January 27, 2020
Tron Positives from the Dapp.com Annual Report 2019
The Dapp.com annual report for 2019 states that there were 3,117,086 total dApps users in the year. Ethereum captured the majority of the market with 1,427,983 users (45.81% share), Tron went second with 967,185 users (31.02%share) and EOS was third with 518,884 users (16.64% share). The rest of the 6.53% share of the users was divided between dApps built on other blockchains. The number of total dApps on the blockchain tell a similar story. For instance out of total count of 2989 dApps on all blockchain. Ethereum topped the list with 1,822 DApps, Tron came second with 520 DApps and EOS managed 493 DApps.
The report concludes that In 2019, TRON has officially become the second-largest dapp ecosystem in terms of the number of dapps and active users, second only to Ethereum.
The Other Side Of The Picture
However that’s not all and the devil as always, lies in the details. TRON ecosystem has grown significantly, sure, however the quality of DApps hasn’t improved, has little diversity and still remains dominated by the gambling DApps (69%) and high risk DApps (10%) on TRON ecosystem, which are responsible for 75% of the volume and active users. There hasn’t been any improvement in the finance and exchange sectors for the year. The TRON ecosystem is yet to show any major growth in the DeFi sector, which is being considered as the next big thing in crypto. Overall, that doesn’t instill much confidence in the TRON blockchain. But the biggest issue for TRON as a DApp ecosystem has been its failure to expand outside its traditional areas.
According to the report, the total transaction volume for DApps was 3.26B, EOS surpassed all blockchain platforms with 2.81B transactions, followed by TRON at 290.28M. Ethereum, the top platform, surprisingly only mustered 24.52M transactions. In the volume transacted in USD for DApps section, EOS again lead the pack. Out of a total of $10.90B volume, EOS did 4.98B, TRON came second at 3.41B and Ethereum could only do 2.37B.
Tron gained nearly 1M active DApp in 2019, however its old user activity is the lowest amongst 6 blockchains. Out of its 967K current users, only 2% of the users were active in 2018 also. The same figure is 23% for EOS and 10% for Ethereum. This signals low user retention and lack of user interest for long term usage of the platform.
Bottom Line
TRON blockchain ecosystem has grown significantly in the last year in terms of active users and number of DApps and now occupies the second spot in blockchain platform, for both of these categories. But, there’s still a long way to go. Going forward, TRON must focus on creating quality DApps, expanding outside its traditional gambling and high risk sector, show progress in decentralized finance (DeFi) category, work to retain existing users and improve value being transacted across network.