Loopring is a decentralized exchange and its LRC token

Loopring is a decentralized exchange (DEX) based on an automated market maker (AMM). This project offers a payment protocol that functions as an Ethereum scaling solution and a second-level protocol. One of the features of the Loopring cryptocurrency platform running on the native LRC token is ultra-fast trading without gas.

In this article, we will delve into the Loopring crypto platform and look at the Loopring Exchange, the LRC token and the Loopring repeater. In addition, we will discuss some of the core technologies underlying the platform, including hash tree, zero-knowledge proofs (ZKP) and zkRollups.

What is Loopring?
A second-level scaling solution
Zero-Knowledge Proofs (ZKP)
zkRollup
Hash Tree (Merkle tree)
Loopring Repeater
LRC Token
Loopring Exchange
Loopring Wallet
Distributed AMM (dAMM)
Results

What is Loopring?
Loopring is both an open source payment protocol, a decentralized exchange (DEX), and a second—level solution on Ethereum. Using zkRollup technology, Loopring Exchange offers the possibility of trading with low fees and Ethereum security.

loorping

Loopring provides the underlying technology to enable DEX scalability and batch processing of thousands of requests offline. The execution of transactions is verified using zero-knowledge proofs (ZKP). And since transactions such as trading and transfer settlements take place outside the Ethereum blockchain, the gas fee is significantly reduced.

Thanks to the second-level solution, users of decentralized finance (DeFi) protocols can enjoy low fees and high Loopring performance without compromising their security. And the Ethereum scaling solution does not use external validators or consensus mechanisms.

Thus, the platform inherits the full security of the Ethereum network, and users' funds are protected from the obligations associated with the centralized storage of the exchange.

The Loopring protocol is a series of Ethereum smart contracts and zero-knowledge (ZK) schemes that take calculations off-chain, providing higher throughput and minimal settlement costs.

The Loopring zkRollup protocol uses a hash tree to organize the balance between users and transaction history. In addition, deposits, withdrawals and settlements are processed in batch mode to ensure high performance.

A second-level scaling solution
Ethereum is the second largest blockchain in the industry and the most famous blockchain with support for smart contracts. This, in turn, means that transactions can be delayed and require high gas charges during periods of high network load. Therefore, Loopring's second-level solutions take calculations outside the chain to prevent the occurrence of "stagnation" in the main chain.

scaling loorping

The second-level Loopring application is a high-performance decentralized exchange (DEX) with a payment platform, an order book and an automatic market maker (AMM). The second-level solution, based on the Loopring protocol and Loopring repeater, offers ultra-fast trading without gas.

From the exchange of individual tokens to high-frequency trading and the provision of liquidity, Loopring offers a more cost-effective method of transactions, which is quite achievable without compromising security or usability.

Moreover, by taking computing off-chain, the Ethereum-based DeFi ecosystem can scale to meet the needs of mass adoption while maintaining decentralization and security.

Zero-knowledge Evidence (ZKP)
Zero—Knowledge Proof (ZKP) is an Ethereum scaling solution and a type of cryptographic method. This allows the parties to prove to each other that a particular statement is true and valid, without disclosing any information other than a statement of reliability.

zkRollup
The bandwidth of Loopring zkRollup is about 1000 times higher than that of Ethereum. This corresponds to approximately 2025 trades per second. In addition, thanks to Loopring's zkRollup technology, the cost of transactions is only 1/100 of the cost of direct interaction with Ethereum.

This is due to the fact that complex calculations are performed off-chain. Using zero-knowledge proof of authenticity to confirm off-network calculations, zkRollups can "roll up" large volumes of transactions at minimal cost, while maintaining the security of the Ethereum blockchain.

Hash Tree (Merkle tree)
A hash tree is a mathematical data structure consisting of hashes from various data blocks. It serves as a summary of each transaction in the block, and provides secure and efficient transaction verification for large data packets. This concept originates from Ralph Merkle, who patented this idea in 1979.

This method is also present in both Bitcoin and Ethereum protocols. In this type of data structure, all transactions within a block are stored using a digital fingerprint of the entire transaction package. In addition, hash trees allow users to check whether a transaction has been included in a particular block.

Loopring Repeater
A repeater is a server system that places, manages and matches orders before transmitting them through smart contracts for settlement. The wallet serves as an interface and together with the repeater creates a decentralized exchange (DEX). Loopring repeater is a server system that allows zkRollup to work.

loorping repeater

Loopring repeater it contains and updates an offline hash tree, and, among other functions, also publishes data and evidence in the Ethereum blockchain. Loopring repeater is optimized for creating proofs and matching orders. Moreover, anyone can use the Loopring repeater to create gas-free decentralized applications (dApps).

LRC Token
The LRC token is an Ethereum—based ERC-20 token that serves as an incentive for various network participants, rewarding liquidity providers, insurers and management participants for their conscientious work on the network.

In addition, the LRC token has significantly increased in price after the announcement that a new market of non-interchangeable tokens (NFT) for the American gaming company GameStop will be placed on the platform. According to CoinGecko, at the time of writing, the LRC token has a value of about $ 1.29, with a market capitalization of $ 1.6 billion.

Loopring Exchange
Loopring Exchange is an order book and decentralized exchange (DEX) based on the second—level automated market maker (AMM) Loopring. With the Loopring exchange, traders benefit from low network load, minimal fees and high performance.

The elegant graphical user interface (GUI) simplifies navigation, and the non-storage service offers full ownership of assets without a single organization or centralized party. The exchange works on top of the Loopring protocol.

In addition, it acts as a payment application, allowing anyone to send ETH or ERC-20 tokens to any Ethereum wallet address via Loopring the Layer 2 solution with minimal costs.

The "outdated" version of the exchange is an exact copy of the popular Ethereum DEX, Uniswap. However, the latest version of the exchange boasts several types of trading, including markets and growing liquidity.

Loopring Wallet (Loopring Wallet)
Loopring Wallet is an Ethereum mobile wallet with smart contract functionality and built-in zkRollup technology. According to Loopring itself, this is the first "smart wallet application with L2 scaling" that offers "the powerful capabilities of Ethereum right in your pocket."

loorping wallet

Loopring Wallet users can make payments, exchange tokens using the Loopring Automatic market maker (AMM), become a liquidity provider (LP) and interact with decentralized finance (DeFi) protocols using a mobile device. In addition, these services do not require a gas fee.

In addition, Loopring Wallet is completely autonomous. The social recovery feature allows users to select trusted persons, institutions and devices that will serve as "keepers" of the wallet.

If a user loses access to his mobile phone, he can access the funds stored in his Loopring wallet, provided that more than 50% of the trusted persons he has chosen are truly trustworthy. In addition, users can set transfer limits and create whitelists of addresses of trusted wallets.

Distributed AMM (dAMM)
Often, second-tier automated market makers (AMM) may be exposed to fragmented liquidity. The more fragmented the liquidity, the more expensive it becomes. However, Loopring is working in partnership with StarkWare to create a "distributed AMM (dAMM)". dAMM distributes liquidity between tiers to solve this problem using asynchronous liquidity distribution, giving liquidity providers more trading opportunities.

Originally named "Caspian", dAMM is a second-tier AMM that aggregates liquidity in a single first-tier pool and implements the use of a first-tier smart contract. This leads to a higher level of investment efficiency and flexible development options.

In addition, dAMM liquidity pools can simultaneously operate on multiple second-tier AMMS, ensuring scalability and avoiding liquidity fragmentation. In addition, the technology allows you to process dAMM transactions on multiple AMMS without the need for mandatory communication.

This works by separating the liquidity pool and the pricing state. When user funds and state are separated, multiple states can be on top of the same liquidity pool.

Moreover, since dAMM is available in several markets, it processes more transactions accordingly. As a result, dAMM generates more commissions for the same amount of liquidity and is more efficient in terms of capital. The rates and the constancy of the token exchange prices also confirm this, since greater liquidity usually allows you to set more favorable prices.

Results
Loopring crypto protocol is an Ethereum scaling solution offering ultra—fast gas-free trading, token exchange and liquidity buildup. The platform will also support the minting, exchange and transfer of non-interchangeable tokens (NFT).

The NFT marketplace will allow users to experiment with digital collectibles and art directly on the second level. In addition, the second-tier solution will also support deposits for the first-tier NFT.

Thanks to the high bandwidth, ultra-fast confirmation time and micro-payments offered by the platform, Loopring helps in the mass implementation of decentralized finance (DeFi) by increasing the scalability of the largest blockchain with support for smart contracts.

Moreover, the creation and deployment of applications on Loopring is much more efficient than directly on the Ethereum blockchain.