- Tron price tumbled to the lowest level since November.
- Huobi announced significant layoffs and a shift in how it pays its staff.
- Tron is a highly centralized cryptocurrency.
Tron price plunged hard on Friday as concerns about the cryptocurrency continued. The TRX token slipped to a low of $0.049, which was the lowest level since November 22. It has plunged by more than 22% from the highest level in November last year.
Tron was started by the controversial Justin Sun
Tron is one of the oldest mainstream cryptocurrencies in the world. It was started by Justin Sun, a Chinese crypto millionaire who is well-known in the crypto industry. Sun is know for several reasons. For example, he famously spent millions of dollars to have lunch with Warren Buffett, the best investor in the world.
He also paid $28 million to fly to space with Jeff Bezos using his Blue Origin space ship. Further, Justin Sun bought BitTorrent, an old torrenting software for reportedly $180 million. He then converted the software into a blockchain platform.
Tron is a blockchain operating system that processes billions of stablecoins on a daily basis. It is a smart contract platform that has grown to have over $4.35 billion in total value locked (TVL), making it the third-biggest platform in the world after Ethereum and Binance.
Why not to invest in Tron
There are several reasons not to buy Tron. First, Tron is a highly centralized blockchain platform that is controlled by Justin Sun. Things can go wrong when power is concentrated in one person.
Second, Justin Sun is linked to Huobi, one of the biggest exchanges in the world. The company was recently acquired by a team associated with Sun and he currently serves as its ambassador and advisor. For a long time, there have been rumours that Huobi exaggerates its business and its holdings.
Also, there are rumours that it is a leading holder of tokens associated with Justin Sun. According to DeFi Llama, it has over $2.8 billion in assets. Its clean assets are worth about $1.9 billion. Huobi is currently laying of staff and paying the rest with stablecoins.
Third, Tron is associated with USDD, an algorithmic stablecoin controlled by Justin Sun and his Tron Reserve DAO. According to the DAO, USDD is backed by $1.4 billion worth of assets, which is bigger than its market cap of $725 million. Still, we should remember that Terra USD was also overcollateralized.
Finally, Justin Sun is associated with Tron DeFi ecosystem like JustLend, JustStables, and Sun.io. For example, Sun.io acquired JustSwap. There are rumours that Sun and his organization have a lot of interest in these products.
Tron price prediction
Another reason to avoid Tron’s TRX is based on technicals. The four-hour chart shows that Tron price moved below the lower side of the ascending channel shown in green. It also crashed below all moving averages while the MACD and the Stochastic Oscillator drifted lower. Therefore, Tron price will likely have a bearish breakout as sellers target the key support at $0.400.
