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Loopring builds protocols, infrastructure and products for users focused on finance applications.
This project is built on Ethereum, and more specifically on layer 2 (zkRollups) of Ethereum.
Loopring provides a low-gas, high-speed platform for trading, exchange, liquidity provision and payments – without sacrificing the technological attributes offered by the use of Ethereum.
Loopring’s goal is to design and build the best zkRollup exchange and payment protocol on Ethereum, and to operate products that make it available to users worldwide.
The story of Loopring’s creation dates back to 2017, when Daniel Wang, a Chinese computer engineering entrepreneur, founded the Loopring project.
Daniel Wang graduated in computer science from Peking University.
He then obtained a master’s degree in software engineering from the University of Central Florida in the USA.
Prior to founding Loopring, Daniel Wang had a background in the technology industry and the financial world.
He worked for companies such as Google, JD.com and Nuance Communications.
With his background, he then founded Loopring in 2017.
Inspired by the possibilities offered by blockchain technology and the challenges faced by centralized crypto-asset exchanges, his goal was to create a decentralized protocol that would enable users to exchange crypto-assets faster and at no cost using Ethereum’s layer 2 properties.
At the time the project was conceived, the crypto-asset market was booming, but there were serious problems associated with centralized exchanges.
Users were faced with problems of security, theft of funds, lack of transparency and exchange platform failures.
This prompted Daniel Wang to look for solutions to make exchanges safer and more efficient.
Also at the time, the Ethereum blockchain was in Proof of Work, and the costs associated with using such a blockchain could be excessive, and the processing time incompatible with financial use (trading, for example), which could have requirements in terms of exchange volume, exchange speed and reduced costs for the latter.
This led to the publication of the whitepaper: In August 2017, this whitepaper describes in detail how the protocol works and its potential benefits for crypto-asset users.
Its whitepaper can be found at the following link https://loopring.org/resources/en_whitepaper.pdf, which looks more specifically at how exchanges work (centralized and decentralized) , their strengths as well as their weaknesses.
In order to launch its project, Loopring managed to raise funds in the form of an ICO to develop and launch Loopring.
Loopring’s ICO (Initial Coin Offering) was launched in August 2017 to finance the project’s development.
During this period, the LRC token was sold to investors to raise funds.
On this fundraising :
Who are Loopring’s investors? Loopring managed to raise an impressive $87 million in total, spread over the years 2017, 2018 and 2019.
The Chinese company received financial backing from seven investors, including names such as Kosmos Ventures, China Growth Capital and NEO. 
Loopring is a protocol based on Ethereum’s layer 2.
It should be noted that the “zk-Rollup” technology is at the origin of the Loopring protocol.
This saves users time and money when using the Loopring system. Loopring live course.
The Loopring protocol is powered by its native LRC token, which was launched in 2017.
Among other things, the token is used to pay transaction fees on the Loopring DEX, 80% of which is redistributed to liquidity providers, and the remaining 20% is split between Loopring’s insurance fund and the DAO .
The LRC token is an ERC-20, which can also be used on all DApps (Decentralized Applications) on the Ethereum blockchain, not just on the Loopring DEX.
Loopring’s main mission is to merge elements of centralized and decentralized crypto-asset exchange platforms to create a protocol that leverages the advantages of both types of platform while eliminating inefficiencies.
Currently, centralized exchanges dominate the crypto-asset exchange services sector.
Although these platforms are very popular and accessible, their use entails several risks, principally the safekeeping of user funds, exposing these funds to potential loss in the event of hacking, malicious acts within the platform or regulatory intervention.
Another major problem with centralized platforms is the lack of transparency.
The fact that orders are not settled on the blockchain, but rather stored in the platform’s internal ledgers, opens the door to price manipulation and fraudulent use of user funds.
To address these issues, decentralized exchange platforms (DEXs) have emerged, eliminating the need to store funds and ensuring transparency by settling transactions on a public blockchain.
However, despite these advantages, DEXs also have drawbacks such as lower efficiency compared to centralized platforms, limited capacity of the underlying blockchains and fragmented liquidity.
To start trading on a Loopring exchange platform, users must first send their funds to a smart contract managed by the Loopring protocol.
From there, Loopring exchange platforms perform the necessary calculations to complete transactions outside the main Ethereum blockchain, including information such as user account balances and order history.
Loopring then settles transactions on the Ethereum blockchain to finalize transactions between users who were initially matched off-chain.
These transactions are grouped together to reduce costs and increase speed, with Loopring claiming to be able to perform over 2,000 transactions per second using this technique.
Each batch of transactions is then added to the Ethereum blockchain with zero-knowledge disclosure proofs, enabling anyone to reconstruct transactions that took place off-chain.
In this way, users can be sure that transactions are genuine and have not been tampered with by unwanted parties.
Loopring (LRC) Tokenomics Overview
Key Utilities:
Objective:
LRC’s tokenomics are designed to enhance security, incentivize ecosystem participation, and maintain long-term value.
Loopring is an interesting project because it offers an efficient solution for fast, low-cost cryptocurrency transactions, thanks to its zkSNARK rollup technology on Ethereum Layer 2.
This reduces gas costs and improves transaction speed without compromising security (thanks to the Ethereum blockchain), making trading more accessible and economical.
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