Loopring’s LRC token is causing upheaval. WAVES is trending 

Loopring’s Ethereum-based token LRC is attracting more and more attention on the market. Loopring is an open protocol. The team designed it for the building of decentralized cryptocurrency exchanges. It has great potential, considering that the average daily trading volume of the entire crypto market fluctuated in the range of $50-$200 million in 2020. Market participants conduct most of that trading on centralized crypto exchanges. Private companies operate such online platforms, storing users’ funds and facilitating the matching of buy and sell orders.

However, centralized platforms have various downsides common to all of them. That’s why investors are so interested in a new type of exchange, which is decentralized. The latter tries to solve all those problems that became so characteristic of centralized ones. However, fully decentralized exchanges have their own flaws. After all, they are still relatively new. There’s lots of space for improvement. That’s what the Loopring team aims to do.  

The company wants to combine centralized order and its matching decentralized on-blockchain order settlement into a hybridized product. Its platform will take the best aspects of both centralized and decentralized exchanges. The team also launched the LRC tokens ICO sale in August 2017. But despite the early token release, it hasn’t deployed the Loopring protocol on the Ethereum mainnet until December 2019.

Daniel Wang is the founder and current CEO of Loopring Foundation. He manages the development of the Loopring protocol. Wang is a software engineer and entrepreneur, and he’s based in Shanghai, China. Prior to starting work on this project, Wang held multiple executives and managerial positions in major tech companies. For instance, he was a lead software engineer at the medical device manufacturer Boston Scientific, a tech lead and senior software engineer at Google, and the senior director at the Chinese e-commerce giant JD.com.  

Why is Loopring gaining so much attention?

This project offers unique opportunities, along with the chance of amassing profits. The main idea behind Loopring is to combine elements of centralized and decentralized crypto exchanges to create a new protocol that will eliminate inefficiencies. Users will enjoy unique advantages instead of suffering any shortcomings.

Currently, centralized exchanges are the primary mode of operation for cryptocurrency trading services. They are highly popular and convenient, but using a centralized exchange carries a number of risks. The main one is their custodial nature. These exchanges hold customers’ funds for them between the points of depositing and withdrawing. Thus, those funds come under the risk of becoming partially or fully lost due to potential hacker attacks, as well as malicious actors inside the exchange or regulatory intervention.

Another significant problem for centralized exchanges is the lack of transparency. Instead of settling the trades on the blockchain, these platforms store them in their internal records. That makes possible price manipulation by the exchange, as well as allowing the latter to use user funds for unauthorized purposes while in custody.

Instead of holding user funds in custody and processing trades internally, decentralized exchanges help buy and sell orders connect directly with each other. They also settle trades on a public blockchain. However, these types of exchanges are noted for their lower efficiency compared to centralized alternatives. Users also often associate DEX with the limited capabilities of the underlying blockchains and fragmented liquidity.

Loopring protocol wants to keep the advantages of decentralized exchanges and simultaneously reduce or eliminate their inefficiencies via innovative hybrid solutions. This platform will manage orders in a centralized manner, but it will settle the trades on a blockchain. It will also combine up to 16 orders into circular trades instead of allowing strictly one vs one trading pair.

Is the Loopring Network secure? 

Loopring can operate on Ethereum and Neo blockchains. Furthermore, the team plans to add support for the Qtum blockchain. Each of these networks has its own native token: LRC for Ethereum and LRN for Neo. After the launch of the other blockchain version, LRQ will become the Qtum network token.

According to the company, these tokens are secured by the hash functions of their underlying blockchain platforms: LRN by Neo’s SHA256 and RIPEMD160, LRC by Ethereum’s Ethash, and LRQ by Qtum’s proof-of-stake PoSv3 algorithm. The smart contracts comprising the Loopring Protocol govern the issuance of LRC tokens.

There are several ways to acquire LRC tokens. The primary one is to earn them via so-called ring mining. In order to improve the liquidity of the network, the orders in it are not matched strictly as pairs of two cryptos. Instead, the Loopring protocol can mix and match up to 16 orders for different coins in a circular trade, called an order ring. The company rewards nodes on the Loopring network in LRC tokens for combining individual orders into order rings, thus maintaining public order books and trade history.

WAVES standouts among similar tokens. What makes it so unique? 

Waves is a multi-purpose blockchain platform. It supports various use cases, including smart contracts and decentralized applications (DApps). The team launched this project in June 2016. It initially set out to improve on the first blockchain platforms by increasing speed, utility and user-friendliness. However, after that time, the platform has undergone various changes, adding new spin-off features to build on its original design.

WAVES is the company’s native token, used for standard payments such as block rewards. It has a very high-ranking rating on various ICO listing platforms. Ukrainian-born scientist Alexander Ivanov (also known as Sasha Ivanov) is the founder of Waves. Even before creating this project, Ivanov was quite active in the cryptocurrency space. He had released the now-defunct instant exchange Coinomat, as well as indexing site Cooleindex. Ivanov also created an early version of a stablecoin, CoinoUSD, tied to the greenback.

As one of the first offerings in its field, Waves aimed to improve the early blockchain platforms and products. It tried to appeal to prospective business customers looking to use blockchain to improve processes or create new services from the outset. Moreover, Waves supported DApp and smart contract development, ensuring that ease of use and speeds surpassed competition at the time. The company is also evolving with time, offering new advantages to its users. In 2020, the team announced that its platform would be interoperable with the Ethereum network.