Hi, @jayplayco here,
The project SUN is a yield farming project and also a social experiment to enhance and speed up the development of Tron's DeFi ecosystem. It is mined with different kinds of pools without having any pre-mining, reserve for a team, or any investments from outside.
As far as it is designed, the goal would be to be quintessential of Bitcoin for Tron. So let's dive into it to see how the future of this project could look like.
1. Economical Data of Sun
- Technical Background: TRC-20 Token based on TRON
- Total Supply: 19,900,730 SUN
- Current Circulation: 1,677,831 SUN
- Market Cap: 29,7M USD
- Volume (24h): 163M USD
2. Impact on market
Due to the background that project SUN is directly driven by Justin Sun himself, his influence within the crypto scene does have a direct impact on the development and adaptation of SUN in the market.
An important function of this kind of yield farming pools has is to stake funds for a specific timing and rewarding it on the other hand with SUN tokens.
As we can see, project SUN is already staking tokens valued over 300M USD, the biggest part in TRX. This is about 11.6% of the whole market cap of Tron only for Tron. If we look into SUN, about 95.9% of the current SUN supply is staked into the SUN-TRX LP Pool.
This is showing that most of the SUN owners are currently leveraging their SUN with the equivalent amount of TRX to be able to mine more SUN. For a very young project, SUN is also already listed on major exchanges like Huobi, OKEx, Binance, Poloniex, and more.
3. Risk Analysis
If you had been already a TRX holder, the current risk for participating in the TRX Pool is very low, except for the general price volatility of Tron itself.
Investment risks and opportunities based on LP Pools are always higher than stable coin single pools, as these pools are exposed on both sides for volatility and you may see your total value of your liquidity pool shrinking when both tokens are losing value.
The risk for direct investments for SUN tokens should be based on an individual analysis of the strategy and vision project SUN is following.
4. Opportunity for SUN
At the moment SUN itself is just a governance token for the next mining pools on SUN. But as we know, projects can pivot quite fast into other directions to increase the value of it. Some of these could be like the following.
a. Creating of Governance platform
SUN can't be used for governance at the moment, as this function is not yet implemented. Finding, identifying, and implementing the next pools is still, as we are in the early days, overwatched by SUN itself. We have to face the fact that SUN is still a project that is trying to increase the usage of the TRON DeFi environment. Bringing in the HT token from Huobi is one of these movements, getting big exchanges implementing and accepting TRC-20 based tokens.
For example exchanges like Binance and Huobi are already accepting USDT not only based on ERC20 but also based on TRC-20.
But with the creation of implementation of a governance platform, SUN can start to have decentralized governance and deciding about the future of the platform based on their token holders.
b. Evolving into full DeFi
Tron does have the architecture to have a healthy DeFi background. Swap platforms like JUST or newly starting alternatives like SalmonSwap are already offering different options to provide liquidity in decentralized manners. SUN also started to leverage its name value and offering mining pools to bring cross-blockchain tokens like HT into the Tron environment.
SUN could accelerate the speed bringing different kinds of tokens outside the TRON blockchain as TRC-20 tokens into the Tron blockchain. TRC-20 based BTC, ETH, LTC, XRP or Steem could be a faster alternative to transfer and trade these assets.
To understand the difference, as an example, it cost about 4 USDT FEE to send USDT based on ERC-20 from Binance to another wallet. But the same USDT send from Binance to a TRC-20 wallet does not involve any fees.
If SUN manages to create Vaults and Earn mechanism in combination with SUN and stable coins, it will sow not only more SUN into the system but also Stable coins and other tokens into the Tron economy. As long as these vaults are creating yields that are attractive enough.
5. Personal thoughts
Excluding the genesis mining, the whole mining process is finished in 16 weeks. When SUN is able to show similar financing products and development power like yearn.finance has in the last few months, theoretically assuming YFI and SUN would have the same market cap, the price for SUN would roughly double from the current 17.5USD. Whatever direction SUN is going, the next weeks until the mining process of SUN is finished are going to be an important milestone for the future of SUN.