Decentralised networks are experiencing a technological revolution marked by unprecedented capabilities and innovations that boost their performance and interoperability.
TRON is a constantly evolving chain with outstanding processing power and use cases that make it home to 1,300+ DeFi applications and projects. The staking feature of this network is unique, as it operates slightly differently from Ethereum and other chains.
Crypto communities are debating on the recent TRON stake 2.0, which further improved the blockchain utility and functionality. Let’s review how the new TRX staking works and how to participate.
Staking with TRON is different from staking ETH, although both processes produce crypto passive income by investing your virtual coins. The TRON chain uses different terminologies that newcomers might find challenging to understand.
When staking, instead of assigning transaction fees to compensate miners, the TRON blockchain network uses energy and bandwidth resources as inputs to drive chain operations.
Energy is required to perform smart contracts, and bandwidth powers TRX token transactions. Every active TRON wallet receives free bandwidth points, while energy points are earned by staking.
When you stake TRON, votes are delegated between these two resources according to network requirements and congestion, which are calculated as gas fees to reward miners.
This model is called “Delegated Proof of Stake” or DPoS, opposing Proof-of-Work that is used by Bitcoin miners and Proof-of-Stake applied in the Ethereum blockchain. The DPoS approach uses “Super Representatives” or SR instead of validating nodes.
These features, besides the network’s outstanding power to process 2,000+ operations per second and rapid consensus time of 3 seconds, make the TRON blockchain an outstanding option for DeFi projects, decentralised applications, crypto games and staking investments.
Despite its uniqueness, TRON staking presented some shortcomings. Unstaking problems arose, and inefficient resource allocation and lack of interoperability problems started surfacing many users’ reports.
In April 2023, the network introduced a new staking model: Stake 2.0.
The most important update is engaging the Tron Virtual Machine (TVM) in the staking mechanism, which upscaled the staking capabilities to all network users on different levels. This allowed staking pools to benefit from the chain speed and transaction processing capabilities.
The new approach solved the unstaking rule, which required users who wanted to withhold resource delegation to unstake their locked TRX, which meant stopping their investments. However, stake 2.0 allows users to change their delegated votes for resources without affecting their invested coins.
Moreover, previously, energy and bandwidth capacities were automatically assigned when users locked up their TRX coins. However, now, users can allocate their votes. After staking the desired amount, they can delegate votes, which improves resource allocation management.
The new model also enhanced voting rights and procedures and reworked the unstaking process. In Stake 1.0, users could only leave the staking period three days after locking up their coins, which also involved losing all voting rights.
However, the new update allows stakers to cancel their investments anytime without affecting their voting rights, where they can cash out their coins after a short period.
Similar to any other staking, you must find the best place to stake TRON and invest your coins.
Inspect the licenses, reputation, and testimonials given by crypto investors and partners to ensure the provider’s trustworthiness.
Check out the staking requirements, such as minimum amount, APY and campaign period.
Create an account at the website and connect your wallet to the staking terminal.
Start assigning votes to SRs using staked TRX coins.
Allocate votes to energy and bandwidth resources according to how much is available on your account.
Summary
TRON blockchain introduced new staking 2.0 functionality, which overcomes the imperfections of stake 1.0, such as unstaking requirements and automatic resource allocation.
The new TRX crypto staking model utilises TVM to elevate its interoperability and performance. Moreover, the network improved resource allocation by allowing users to assign votes and elect super representatives according to their preferences.
These improvements added more flexibility and transparency to TRX users, increasing TRON activity level and improving its decentralised ecosystem.