TRX explained the native token of TRON
TRX is the native token of the TRON network, and can be used for 2 main purposes related to the network are:
- Burning TRX
- Staking TRX
Burning TRX
Section titled “Burning TRX”Burning TRX refers to the process of permanently removing TRX tokens from circulation in order
to pay for transactions fees when the user doesn’t have enough resources (Energy or Bandwidth).
| Transaction | Energy | Bandwidth | Burn if resources unavailable |
|---|---|---|---|
| TRX transfer | 0 | ~270 | ~0.27 TRX |
| TRC-20 transfer | ~13,000 | ~345 | ~1.3 TRX |
| TRC-20 — new recipient | ~30,000 | ~345 | ~3.0 TRX |
| USDT — existing recipient | ~65,000 | ~345 | ~6.5 TRX |
| USDT — new recipient | ~131,000 | ~345 | ~13.1 TRX |
Approximate values; actual Energy usage varies by contract execution. “Burn” assumes the required resources are not available from staking.
Burning to pay for energy and bandwidth
Section titled “Burning to pay for energy and bandwidth”When a user burns TRX to pay for a transaction, the amount of TRX burned depends on the type of resource being used:
- We will use for the example a swap from USDT to TRX, amount doesn’t matter. In this case the required resources are around 130,000 Energy and 345 Bandwidth.
| Resources | TRX needed to be staked |
|---|---|
| Enough Energy, no Bandwidth | ~215 TRX |
| No Energy, enough Bandwidth | ~15,300 TRX |
| No Energy + no Bandwidth | ~15,500 TRX |
The approximate cost of burning TRX is based on the current network conditions and may vary over time.
Cost of energy vs bandwidth
Section titled “Cost of energy vs bandwidth”Burning or staking TRX to obtain Energy is very inconvenient for a majority of users, as it requires a large amount of TRX
to be staked or to pay a substantial fee.
Reasons include but are not limited to the following:
-
Smart contract execution: smart contracts require computational resources, which in nature are more expensive than data transfer.
-
Energy demand for DeFi and Tokens: The TRON network has a high demand for Energy due to the popularity of DeFi and token transactions making a large portion of the network’s Energy consumption.
That’s why you can save up to 90% of the cost of Energy by renting it from the Tron Energy Market
Resources obtained by staking TRX
Section titled “Resources obtained by staking TRX”When staking TRX a user can choose to receive either Energy or Bandwidth in return.
| TRX staked | Energy | Bandwidth |
|---|---|---|
| 100 TRX | 952 | 160.7 |
| 500 TRX | 4,760 | 803.5 |
Resources received are based on the current network conditions and may vary over time.
While staking TRX is a more cost-effective way to obtain resources, it also allows users to participate in the governance of the TRON network by receiving TRON Power (TP) and voting for Super Representatives (SRs).