The future of finance is near, that is, Decentralized finance (DeFi). We already have constructed the technology upon which the future of the financial market is going to be based upon, which consists of blockchain technology and cryptography. Now what is needed are specific protocols and infrastructure to navigate through the tunnel that will lead us towards the revolution.
What is Loopring (LRC)
Loopring is trying to do just that. It believes that the future of marketing is built on Ethereum, but more specifically on layer 2 (zkRollups). According to Looper, the users of DeFi now have a great option through their platform to make low-free, high-speed platform for trading, swapping, liquidity providing, and payments – without sacrificing Ethereum security at all. The objective of Loopring is to design the best zkRollup exchange and payment protocol on Ethereum, and to operate products that bring it to users across the world. The security of Loopring is assured by them as they guarantee 100% Ethereum-level security. This implies that it doesn’t have reliance upon validators, consensus, or cryptoeconomic assumptions but only upon Ethereum and Zero Knowledge cryptography.
So, what zero knowledge (zk) imply? A fast and secure gas-free lane through which users can deposit and withdraw Ethereum-based assets. This is a quite the big thing if you have been following crypto where increased traffic can lead to the most drastic of results and major inconveniences if we make the transition to real-life transactions.
Furthermore, we can say goodbye to the scalability problem, according to Looper. The zkRollup throughput Loopring reaches an approximate 1000x the speed of Ethereum trades, which in more basic terms, is about 2,025 trades per second or higher.
The one idea that is to keep an eye out for is the Merkle Tree data structure adopted Loopring’s Protocol 3. To get the highest throughput, Loopring only supports off-chain balances. These are balances that are stored in Merkle trees. Users can deposit and withdraw tokens to their smart contracts, and their balance is updated in the Merkle trees. Through this, the transfer of tokens between different users can happen just through updating the Merkle tree off-chain hence requiring no need for expensive token transfers on-chain.
At the time of writing of this article, the value of LRC, the token Loopring, is $0.7842 which is an increase of 41.31% over the past 24 hours. There has been an increase in its value from $0.4418 on the 27th, a dip and then increasing to reaching its current position and reaching its all-time high value of $0.8238 back in February, when it fell which can most likely be attributed to crash of the market in April.