Tron founder Justin Sun has announced a new stablecoin project. It is supposed to be a unique solution, aiming to eliminate gas fees for peer-to-peer transfers. The stablecoin will cover fees by itself. That sound a bit fantastic, yet there is a pretty plausible explanation.
Sun revealed the plans in a July 6 social media post. He mentioned that the project targets implementation on the Tron blockchain this quarter.
Expansion to Ethereum and other EVM-compatible chains will follow. Sun stated, "Transfers can be made without paying any gas tokens, with the fees being entirely covered by the stablecoins themselves."
Specific mechanics of the system were not disclosed. Sun believes the innovation could boost corporate adoption of blockchain technology. "I believe that similar services will greatly facilitate large companies in deploying stablecoin services on the blockchain, elevating blockchain mass adoption to a new level," he said.
Tron currently dominates the peer-to-peer stablecoin transfer market. Analytics firm Artemis reported on June 27 that Tron consistently processes two to three times Ethereum's volume.
Over $50 billion of Tether's USDT circulates on Tron. This represents nearly half of USDT's $112 billion total market cap across all blockchains, according to DeFiLlama data.
Tron's proposal may compete with existing solutions. PayPal's PYUSD offers free cross-border payments to certain U.S. users. Circle's USDC on Ethereum layer 2 Base also provides fee-less transfers via Coinbase Wallet.
There might be a simple explanation of why Tron is so eager to develop such a stablecoin right now. Recent developments may have spurred Tron's initiative. Circle and Binance recently dropped support for USDC on Tron. This potentially created an incentive for Tron to develop its own solution.
Tron is exploring additional blockchain integrations. The project is considering a Bitcoin layer 2 solution to support wrapped Tether. This could enable significant capital flow into the Bitcoin ecosystem.
Currently, Tron utilizes existing cross-chain protocols. These bridge USDT and other tokens between Bitcoin and Tron networks.