TRON founder Justin Sun has revealed that the network might reduce the TRX block rewards due to TRX’s rising price, sparking a discussion in the cryptocurrency community.
Sun noted that this move is similar to Bitcoin’s halving mechanism, capturing the attention of investors who are wondering about the plan’s possible impact on traders.
Tron: Reducing Block Rewards
Sun shared, in a post on X, his thoughts on potentially implementing a reduction in the network’s reward scheme for its TRX.
He said that it is worth paying attention to the discussion about TRX’s upcoming reduction in block rewards.
“Here are my personal thoughts. As we all know, TRX is already in a deflationary state of 1% per year, making it the only deflationary asset among major cryptocurrencies,” he explained.
The TRON founder said that due to TRX’s rising price, “the rewards for block-producing nodes across the network have increased significantly, so a moderate reduction could be considered.”
This discussion about TRX’s upcoming reduction in block rewards is worth paying attention to! Will TRX follow Bitcoin’s path and enter a halving cycle?
Here are my personal thoughts. As we all know, TRX is already in a deflationary state of 1% per year, making it the only…
— H.E. Justin Sun
(@justinsuntron) March 21, 2025
Following Bitcoin’s Path
In the post, Sun said that TRX might follow what happened to Bitcoin, saying, “Will TRX follow Bitcoin’s path and enter a halving cycle?”
He explained that the firstborn cryptocurrency followed a similar path, saying that once the BTC network grew, investors saw a gradual decrease in its block rewards.
“In the early days, higher rewards were necessary for bootstrapping the network. However, as Bitcoin’s price surged, block rewards were lowered, and the halving cycle played a crucial role in Bitcoin’s long-term sustainability—aligning with Satoshi Nakamoto‘s original vision,” the founder added.
Impact Of The Reduction
Sun also shared the possible impact of reducing TRX block rewards, giving two scenarios.
“If daily block rewards are reduced by 1 million TRX, the deflation rate would increase by 50%, reaching 1.5% per year,” he said.
On the other hand, he believes that if TRX is reduced by 2 million, the deflation rate would increase to 2% per year, “effectively doubling the deflation rate, with an impact on TRX cycles comparable to Bitcoin’s halving.”
“Even with a block reward reduction, the current incentives for network validators remain highly attractive. Ultimately, this decision rests with the TRX community,” he added.
The founder revealed that the network has formally submitted on GitHub the proposed block rewards reduction.
“The adjustment aims to create a more balanced supply-demand dynamic encouraging increased user participation in staking. This will benefit all stakeholders, ensure the TRX block rewards consistent with the maturity of the TRON network, and promote the healthy and sustainable development of the TRON ecosystem,” the network stated in the proposal.
Among the benefits that can be gained from its implementation are better deflation, increased staking incentives, strengthened network security, and improved economic alignment.
“Timely adjustments to TRX block rewards can better promote the healthy and sustainable development of the TRON network and TRON ecosystem,” the network added.
Featured image from Gemini Imagen, chart from TradingView
