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TRON Secures Second Spot in TVL Rankings — 20% TRX Price Rise Hints at New Yearly High

Published May 13, 2024 1:31 PM
Valdrin Tahiri
Published May 13, 2024 1:31 PM
By Valdrin Tahiri
Verified by Peter Henn

Key Takeaways

  • TRX has been the best performing large cap cryptocurrency since April 18.
  • The TRON network also boasts a solid performance, evidenced in its revenue and TVL.
  • Since the TVL reached a new all-time high in March, the TRX price could attempt to do the same.

The TRON price has fallen since its yearly high in February, when it was very close to reaching a new all-time high. Despite the decrease, TRON’s Total Value Locked (TVL) reached a new all-time high in March, contrasting other blockchains which did so in 2021.

The TRX price has regained its footing since April 13, breaking out from its main resistance trend line. The price has given a strong bullish signal that has traders speculating on the possibility of a new yearly high.

TRON’s Solid Performance in April

In April 2024, The TRON blockchain experienced notable growth across various metrics, with fees and revenue reaching over $125.6 million, over 170 million transactions conducted, and nearly 5.9 million new unique addresses created. In contrast, Solana has only $16.72 million revenue  over the past 30 days. Ethereum’s revenue is also decreasing as a result of the drop in the ETH burn rate.

Additionally, TRON’s stablecoin market cap surged by $2.8 billion, primarily driven by USDT, solidifying its dominance in the stablecoin market. TRON is the blockchain with the most USDT, outpacing Ethereum $55 billion to $45 billion.

While the performance is impressive, what truly stands out is the Total Value Locked (TVL) relative to the all-time high, and to other blockchains.

What’s Driving the TRON TVL?

While TRON’s TVL fell slightly in April, it is still very close to its all-time high of $10 billion reached in March. In contrast with other blockchains, Ethereum’s TVL of $57 billion is more than 60% below the all-time high of $12 billion, while that of Solana is over 40% below its all-time high.

So, TRON’s TVL is in second place, trailing only Ethereum, and outpacing both Solana and the BNB chain. This notes its growth since January 2022, when TRON was seventh.

Tron Total Value Locked Historic
Tron TVL | Credit: DeFiLlama

This increase in Tron TVL is primarily driven by JustLend. JustLend  DAO stands as TRON’s decentralized financial hub, offering users opportunities to generate yields by supplying assets, borrow digital assets with collateral, engage in TRX staking, and lease Energy.

JustLend accounts for $6 billion out of the $8.3 billion TVL in Tron. Its release in 2022 coincided with the increase in TVL of TRON.

Tron TVL By Category
Tron TVL Categories | Credit: Coin98 Analytics

An innovative aspect of JustLend is its use of the Staked TRX (STRX) token. Users can stake TRX  for an APY of 4.4% and then receive STRX, which can then be used for energy rental  and additional yield of 6.49%. The mechanism is similar to a liquid staking protocol and gives a total APY of 10.89%.

Interestingly, despite its importance in the ecosystem, the native token JST ranks only 192nd based on its market cap.

Can TRX Reach a New Yearly High?

The weekly time frame TRON price history shows decisively bullish price action. This is because TRX broke out from a confluence of resistance levels at $0.113. A horizontal resistance area and 0.5 Fibonacci retracement resistance level create this confluence.

The breakout led to a new yearly high of $0.144. After the TRX price corrected, it returned the area in April and bounced (green icon), validating it as support. So, the weekly time frame price action shows a breakout and retest of an important confluence of resistances.

TRX Long-Term Price
TRX/USDT Weekly Chart | Credit: TradingView

The daily time frame readings support the positive sentiment from the weekly one. There are several reasons for this.

Firstly, the previously outlined bounce was combined with a bullish divergence in both the RSI and MACD (green lines). These divergences often lead to notable upward movements. As expected, the price broke out from a descending resistance trend line shortly after the signal.

More importantly, TRX moved above the short-term 0.5 Fibonacci retracement resistance (black) and a horizontal resistance area at $0.124. So, the short-term movement is a microcosm of the long-term one.

TRON Yearly High
TRX/USDT Daily Chart | Credit: TradingView

If the upward trend continues, the next resistance will be at $0.168, created by the 1.61 external retracement of the drop. This will be a new yearly high but is still below the $0.180 all-time high price.

Despite this bullish TRX price prediction, closing below the $0.124 support area can lead to a deeper retracement toward $0.114, but will not invalidate the bullish trend.

TRON Poised for a New Yearly High

TRON’s fundamental outlook and the TRX price movement are both positive. The TRX price has increased 20% since its lows in April 13, and this increase is supported by growth in the network, both in revenue and TVL. As long as the TRX price trades above $0.124, another upward movement that leads to a new yearly high is likely.

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