Tether, the company behind the USDT stablecoin, has seen its token become one of the most widely used in the cryptocurrency market. It has become the most popular option in the stablecoin market. Because its value is tied to the US dollar, USDT provides a more stable option during times of high market volatility. USDT is available on multiple networks, including Tron and Ethereum. Can the decision to swap USDT TRC20 to ERC20 be a smart choice? Here’s what you should know about these token standards first!
What Are ERC20 and TRC20 Tokens?
ERC20 is a token standard for all coins issued on the Ethereum network. Apart from USDT, many other coins exist on the network since many other cryptos are created with smart contracts on Ethereum. You can manage and transfer USDT tokens on the Ethereum network using compatible wallets and apps powered by the Ethereum Virtual Machine (EVM), the core technology that runs Ethereum smart contracts.
TRC20 is a token standard that exists on the Tron network. TRC20 tokens like USDT are built using a system called the Tron Virtual Machine (TVM), which works like Tron’s version of Ethereum’s smart contract engine. You can use USDT coins issued like this only on the Tron network. It ensures you reap the benefits of this blockchain, such as fast transactions.
Comparing ERC20 and TRC20 for USDT Transfers
Both token standards are viable, so the choice depends on your preference. If we focus on USDT transfers, here’s how the two networks compare in different categories:
- Transaction fees. If you observe things as an investor, transfer costs become a primary consideration. Tron offers negligible charges per transaction. Even at large volumes, they shouldn’t present a significant item in your total profit calculation. Ethereum, on the other hand, can be pricey, especially during congestion.
- Transaction speed. It depends on the timing, but Tron rarely takes more than a minute to settle a transaction. It’s much faster on most occasions so that you can expect completion in merely a few minutes. ERC20 transactions can take minutes or hours during the most considerable congestion.
- Network congestion. Despite recent upgrades like the shift to Ethereum 2.0, which aims to improve performance, the Ethereum network still struggles with handling large volumes of transactions at once. A large transaction number often leads to congestion, which leads to higher charges and more time to settle a transfer. Tron is faster and handles busy periods better, making TRC20 tokens more reliable.
- Adoption. Ethereum has thousands of decentralized apps, services, and tools. It’s undoubtedly the most popular ecosystem. From popular crypto wallets like Ledger and Metamask to NFT marketplaces like Opensea and gaming platforms like Decentraland, Ethereum features an excellent app selection. Tron has a more modest number of apps. However, the selection is decent and includes games, decentralized finance, NFTs, and various cross-chain and infrastructure services.
To check out more networks, you can compare HBAR and SOL to learn about these platforms.
Benefits of ERC20 for USDT Transfers
The main advantages of ERC20 for USDT transfers include:
- Accessing the network’s extensive dApp ecosystem. Ethereum offers a host of decentralized finance apps and services. Among thousands of projects, you can play games, trade and manage assets, etc. The options are extensive, ensuring maximum usability for the ERC20 USDT token.
- High levels of decentralization and security. Ethereum is famous as a secure blockchain with the latest safety measures applied across the network. The chain uses the proof-of-stake security protocol, which ensures decentralization and immutable transactions.
- Ideal for integration with Ethereum-based projects. If you want to use existing or launch new Ethereum projects, it’s only logical to go with USDT with the ERC20 standard.
Benefits of TRC20 for USDT Transfers
If you choose the Tron network for your USDT coins, these will be the benefits:
- Significantly lower transaction charges. If you are conducting large transfers, the gas fees become a primary consideration. Tron is famous for its affordable charging structure.
- Faster processing times. That also applies to peak periods when there’s a lot of traffic, and the network has to deal with a large number of transfers.
- Practicality for small-value or frequent transactions. Tron is also suitable for microtransactions, primarily due to its speed and low cost. If you are a day trader or make frequent swaps, you’ll also appreciate these benefits.
Final Thoughts: ERC20 or TRC20 for USDT Transfers?
Both networks have their advantages for the USDT asset. If you use Tether on Ethereum, you’ll benefit from its compatibility with many DeFi and other projects on the chain. Tron, on the other hand, offers faster and cheaper transactions. That makes it more suitable for frequent traders and those looking to keep the charges low. Ultimately, USDT is reliable on both networks, so it’s all about your expectations and needs.