Loopring – everything you need to know about this crypto
Cryptocurrencies are improving in various ways, but Loopring (LRC) wants to upgrade the market. When we say “market”, we mean the online cryptocurrency exchanges. Investors buy and sell coins on these platforms, and most of them are fine with how they work. For projects like Loopring, the good can always be better.
This could lead to more cryptocurrency adoption across the world. If Loopring could improve the investing and trading experience, this could draw in more investors into the crypto space. In turn, this could promote the growth of the cryptocurrency market. This leads to more innovations that could improve our lives even more.
Let’s start by talking more about the issues with current crypto exchange platforms. Then, we’ll introduce the Loopring protocol and explain how it could solve these problems. Still, this solution has problems, so we will elaborate more on those too. Put these details together, so you can decide if you should invest in LRC tokens or not.
Crypto exchanges have issues
You’ve heard of bitcoin (BTC) because it’s the most well-known cryptocurrency right now. After all, it was the first one. However, it was open-sourced, which allowed people to tinker with BTC.
They made digital currencies that followed bitcoin’s lead. Some placed minor upgrades to its features, while others learned to create separate cryptos with major improvements over bitcoin.
Eventually, the world had hundreds of cryptocurrencies available, and you can find them all in crypto exchanges. Investors likely have bought their first coins from Binance or Coinbase.
Yet, these custodial exchanges are far from perfect. By far, the biggest issue with them is that they were centralized platforms where people exchanged decentralized assets.
You will have to create an account that will store your coins. This means your cryptos are on someone else’s platform, not in your hands. It’s no problem if they are super secure.
Unfortunately, hackers can still get into them and take millions of dollars worth of crypto away. That’s your hard-earned coins just gone if the platform fails to keep your coins safe.
What’s more, you cannot be sure about how it will handle your funds. They may not explain fully why your account got frozen or how it could help you in case it shuts down.
On the other hand, decentralized exchanges often charge a high transaction fee because many are Ethereum-based exchanges. In February 2021, it hit an all-time high of $40!
Loopring has a solution
For those new to crypto, Ethereum or Loopring L2
Here is a Full Guide / Tutorial to our brand new web app 🤓
Connect a MetaMask wallet to Layer2, deposit to Loopring L2, order-book trade, simple swap or provide liquidity to the AMMs
— Loopring (@loopringorg) November 7, 2021
In 2017, Danial Wang came up with a way to fix issues with the launch of Loopring. It was a cryptocurrency exchange that connected to the other ones.
Loopring was a scaling solution that maintained high transaction speeds. In other words, it could link to more platforms without slowing down the trading experience.
What’s more, it allowed users to keep holding on to their coins while processing transactions. Their funds will only transfer once that’s done. The key to Loopring is its use of zk-Rollups.
The “zk” stands for “zero knowledge”. It lets Loopring claim data about your coins without sharing it. Here’s how this system works:
- Loopring gathers hundreds of transactions and combines them into one. It matches up to 16 identical orders and collates them in an order ring. Loopring does this with the help of order books from the exchange platforms linked to it.
- Ring miners fulfill these orders before they cancel or expire. Unlike miners in other cryptos, they don’t confirm transactions. The zk-Rollups are in charge of this task.
- Smart contracts check the orders to make sure the network could fulfill them. If the order ring is good to go, these smart contracts send the coins to the recipients.
You could earn from becoming a ring miner on Loopring by receiving a fee in LRC tokens, or a bit of the crypto being transferred. Overall, the platform is fast and secure.
Read more: Why DeFi Crypto Is The Next Step For Finance
Loopring has a problem too
Despite the nifty features, Loopring has one thing that keeps people from using it: competition. It’s offering a service that you can find in so many other cryptocurrencies and platforms.
We could share examples of cryptos that function similarly to Loopring. You may click on the names of these cryptos to learn more about them:
- Polkadot (DOT) – It lets people create smaller blockchains called parachains that work with the mainnet. What’s more, Polkadot hosts many DEXs on its platform.
- Cosmos (ATOM) – Unlike Loopring, it doesn’t just use data from various crypto exchanges. Cosmos goes one step beyond by forming an “Internet of Blockchains”.
You may find numerous other cryptos that work like Loopring. However, those have been around for a long time. It will have to provide a feature good enough to convince folks to use Loopring instead.
Should you still invest?
We may have found the feature that will bring in more LRC investors. The internet has rumors of Gamestop working with Loopring to create an NFT marketplace.
This caused a 400% increase in the Loopring (LRC) price! Sadly, nothing has been confirmed yet, which means investing in it may not be a good idea right now.
It’s not a good idea to invest based on hearsay. Instead, you should work with real data and updates about a potential asset. At the time of writing, these were the details regarding LRC:
- Loopring price – $3.12
- Market cap – $4,123,634,774.98
- Trading volume – $3,213,072,173.79
- Circulating supply – 1,327,062,164 LRC
We cannot be entirely sure how Loopring will perform in the coming months or years. After all, its price movements may shift within the next 24 hours!
That's a new Loopring L2 daily record in trading volume🔥 pic.twitter.com/ni63b4CAMh
— Loopring (@loopringorg) November 2, 2021
This may be frustrating, but this is just how the cryptocurrency market is. The asset is well-known for its price volatility. Your coins may spike up or down within a few days!
Take Shiba Inu (SHIB) coins as an example. Its value hasn’t been moving much until Tesla CEO Elon Musk tweeted about his dog. As a result, the price went up significantly!
Keep this in mind if you’re planning to invest in Loopring or other cryptos. You could take advantage of these shifts as a short-term investor.
On the other hand, you could choose relatively more stable cryptos like bitcoin for your long-term investments. This is why we always remind readers to do their research.
This article is not meant to provide investment advice. Instead, it teaches about the Loopring network and its LRC token. Have a plan before you start investing.
Then, go online to find the assets that could fit your investment plan. Learn how they work, and check their latest updates. Fortunately, you’re already on a great source of crypto news!
Read the other Inquirer USA articles to learn more about other cryptocurrencies. What’s more, those provide more information about other assets like stocks and bonds.