TRON (TRX) Halving Event Could Positively Impact the Altcoin in Various Ways

As expected, this discussion has prompted TRON's founder Justin Sun to make a case for the altcoin's halving.

Tron (TRX) community has been discussing the possibility of a Bitcoin-like halving event for the coin, a move that could see the deflationary pressures on the cryptocurrency increase significantly.

This discussion follows a post by TRON’s founder, Justin Sun, who spoke about the potential benefits of reducing block rewards for TRX. According to Sun, TRX is already decreasing in supply by 1% per year, making it the only major cryptocurrency with a deflationary state.

However, as the prices have risen, rewards for block-producing nodes across the network have risen considerably. Hence, a moderate reduction can be beneficial to the network.

Citing Bitcoin’s path, Sun posited that as Bitcoin’s network grew, block rewards gradually fell. In the early days, higher rewards were necessary for bootstrapping the network. However, as BTC’s price surged, block rewards were lowered, and the halving cycle played a role in Bitcoin’s long-term sustainability.

Therefore, just like Bitcoin, TRON could benefit significantly from reduced block rewards. As such, if daily block rewards are reduced by 1 million TRX, the deflation rate would increase by 50%, reaching 1.5% per year.

Equally, if reduced by 2 million TRX, the deflation rate would rise by 2% annually. This would effectively double the deflation rate with an impact on TRX’s price, one comparable to Bitcoin’s halving.

According to Sun, even if the block reward is reduced, the current incentives for validators are highly attractive and will still keep them in profitable positions.

What would it mean for TRX?

As suggested by TRON’s founder, more deflationary measures would greatly benefit TRX.  Therefore, a halving event for it could positively affect the altcoin in various ways. For starters, it would result in market speculation in every halving cycle, driving the altcoin’s demand in the process.

Additionally, lower rewards will result in reduced supply which would lower inflation on TRX’s price. Lower supply results in higher prices, especially if demand remains high or constant.

Based on supply and demand, TRX will benefit extensively on its price charts. As such, TRX could grow and reclaim its ATH and climb to $1.