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Find out more about this layer-2 protocol on Ethereum that could increase security and reduce gas fees. Check out our “What Is Loopring?” guide to learn more.

Covered:

  • What is Loopring?
  • Features of Loopring
  • Partner & Team
  • Tokenomics

What Is Loopring?

Current decentralized exchanges (DEX) often have limitations that make them unable to compete with big centralized exchanges. Daniel Wanf and the team aim to solve that problem with Loopring. Loopring is an open Ethereum Layer-2 protocol for building high-performance, order book-based, and automated market makers (AMM)-based DEX. It provides a scaling solution to DEXs on Ethereum without compromising security with Zero-Knowledge Rollups (zkRollups) while reducing gas fees with its hybrid solution. That means it extends a solution of on-chain settlement with off-chain order management. These solutions revolve around open smart contracts while performing several functions off-chain and giving nodes flexibility in fulfilling critical roles of the network.

Currently, Loopring’s most recent version is Looping 3.6. Loopring 3.6 was designed for performance and security. It allows users to withdraw their assets in any circumstances. Furthermore, Loopring also has two live projects: the Loopring Wallet and the Loopring Exchange. Designed to give users a similar experience to Paypal, Loopring Wallet is the World’s first Etheruem smart wallet powered by zkRollup. Users can easily install the Loopring Wallet on iOS or Andriod and enjoy only paying 1% of Ethereum Layer-1 fees. The Loopring Exchange is a self-custodian order book-based and AMM-based exchange with quick and cheap trading fees. The team continues to update their product, with Loopring 3.8 currently in the works.

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Features of Loopring:

To clarify, Loopring is not a DEX but a modular protocol to build DEXs on multiple blockchains. Loopring has some exciting features listed below:

  • Order Rings are a unique feature of Loopring and where it got its name from. The order ring protocol is also called a Unidirectional Order Model (UDOM). Instead of fulfilling an order between the exchange of two tokens, UDOM mix and match multiple orders in a circular trade. UDOM allows up to 16 orders instead of fulfilling just a single trading pair.
    • The trade is possible if all necessary tokens are present. For example, a possible order-ring of 3 orders would look like this: Jen trading MATIC for ETH, John trading ETH for SOL, and James trading SOL for MATIC. This trade will only go through if the buyer is willing to pay an equal or higher price than the seller’s price. If the prices that Jen, John, and James set to trade are less or equal to what they were willing to spend, then the trade is possible.

  • Relays & Ring Miners: Relays are nodes that receive the orders, while ring-mining is a feature of relays. Ring miners off-chain computational system responsible for creating the order rings and fulfilling the orders. They are also responsible for canceling the order. 
  • Loopring Protocol Smart Contracts (LPSC) checks the order-ring and data supplied by the rig miner. Then, it determines if the order ring can be fully or partially fulfilled. If the trade is possible, it will transfer the tokens to users and pay fees to all parties owed.

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Partners and Team

As mentioned, Daniel Wanf is the Founder and CEO of Loopring. He was also a Founder of Yunrang Technology, ran a centralized exchange called Coin Port, and held a position as a Google Tech Lead. He founded Loopring to solve problems he encountered while working with centralized exchanges. 

Loopring has also partnered up with O3, Jibrel Network, and Nebulas. In addition, Loopring is collaborating with Chainlink and Oracles for the zkRollup DEX protocol. They are also members of the Ren Alliance, Global DeFi Alliance, and Asia DeFi Alliance.

Furthermore, there have also been rumors about a partnership with GameStop, particularly on the topic of NFTs. It just so happens GameStop’s new Head of Blockchain, Matt Finestone, is a former Loopring employee that left on great terms.

Tokenomics

The Loopring (LRC) token is an ERC20 token. However, Loopring plans on deploying their token on other public blockchains in the future, using LRx as their generalized token notation. With a total supply of 1,374,956,262, no new LRC tokens can be minted. 

LRC is the Loopring protocol token. The token was updated to version 2.0 in May of 2019. It is used to incentivize users of the Loopring protocol. Users that support and help strengthen the network will be rewarded as follows:LRC rewards for users

  • 80% to Liquidity Providers (LPs) on Loopring order books and AMM.
  • 10% to Insurers: Users who put capital into a safety insurance fund.
  • 10% Loopring DAO – the DAO voters for future decisions regarding the project

Loopring DAO is said to launch in Q3 of 2022. The incentive distribution is subject to change depending on the DAO.

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Concerns:

One of the biggest concerns for Loopring is competition. There are many well-knownbLayer-2 DEXs out there that are not using Loopring. Polygon seems to be outperforming Loopring, with SushiSwap, QuickSwap, and Curve adopting it for their Layer 2. The technology that Loopring offers is impressive. However, one can’t say the same with their marketing and partnerships. Technology in and of itself might not be enough in the highly competitive blockchain space. The adoption rate and popularity of the project also determine if the project will make it. The good news is that rumors of interesting partnerships are coming Loopring’s way. This may or may not help put Loopring on the map, and we shall wait and see.

Where To Buy LRC?

You can purchase LRC through KuCoin exchange similar to how you would buy another cryptocurrency. You can either place a market buy or a limit buy. With a limit buy, you determine the price you are willing to pay, and your order gets filled once the token price reaches your limit price. If you want to get your hands on the token quickly, you can place a market order, where you agree to pay the current price and have your order filled almost immediately. If you are interested in purchasing LRC you can do so by visiting KuCoin, Gate.io, or Binance.US

The post What Is Loopring? appeared first on CryptosRus.

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