The non-fungible token (NFT) industry pulls more loyal investors, as seen from Loopring’s (LRC) price jump. Although the industry is still largely undervalued, experts believe it has many potentials, especially with growing interest. Similarly, there are numerous NFT projects in the space that are also getting mainstream attention. Reports show that Loopring’s recent price growth is due to a partnership rumor between the protocol and GameStop.
Since November’s beginning, the asset has jumped by over 200%, and some indications suggest that the word is fueling the new highs. Despite the recent market correction affecting most digital assets, LRC and some other altcoins seem unaffected. From all indications, the crypto market has performed well since the beginning of this month, resulting in many assets returning to old highs. Months ago, Bitcoin fell from the $50,000 range, which caused an alarming correction, affecting the industry. However, it’s great that the market has recovered, which could mean that the bull run will continue.
What Is An NFT Marketplace?
NFT marketplaces are the pillars of the non-fungible token industry. Most NFT marketplaces host numerous artworks, designs, and other assets, which are non-fungible tokens. In addition, non-fungible tokens are unique assets, which cannot be altered or changed for another one. They are usually unique as only a few pieces of an NFT are mostly in existence.
This, in turn, has made the industry an attractive one for artists and other creators. They can leverage the growing demand for art pieces to make a fortune. Beeple, one of the industry’s most famous artists, sold an artwork for $69 million, which is the most expensive in the digital asset industry. When you own an NFT, your ownership is usually embedded in the blockchain, which means no one else can claim ownership. Scarcity is another feature driving the new industry. Investors get to own scarce and rare pieces of artworks and other NFTs.
What Is A Layer-2 solution?
In simple terms, a layer-2 solution is a protocol built on an existing network. The main reason for these protocols is to help blockchain execute transactions faster while maintaining a low cost. Today, many crypto chains have scalability issues, which has caused many concerns for crypto enthusiasts. While cryptocurrencies might be the future of banking, if they cannot implement transactions at record speed and charge an affordable fee, they may find it challenging to compete with mainstream platforms.
Ethereum is one of the most used crypto networks in the ecosystem, enabling ETH to grow rapidly over the years. However, the network cannot implement thousands of transactions at once, which makes it slow. Even when prioritizing your transactions, you may still wait several minutes before you get your transactions executed. This is why off-chain solutions have grown very popular in the digital asset space. This solution would take most of the responsibility when it comes in, and users may notice faster executions and lower costs.
What Is Loopring?
In December 2017, Daniel Wang, a Chinese programmer, released the Loopring protocol. After the release, he organized an initial coin offering, which raised over $40 million in Ethereum. However, the growing regulations in China mandated the refund of over 70% of the money raised by the project.
Loopring is a project based on the Ethereum network. The project aims to incentivize users to utilize a network, enabling the creation of different kinds of digital assets exchanges. Additionally, the platform assured that trading platforms built on it would not suffer from low speed and high gas fees, typical for decentralized exchanges (DEXs) built on Ethereum.
To achieve this, it aims to use a type of cryptography known as zkRollups to reduce transaction costs while increasing speed. Similarly, the platform claimed that cryptography would assist in enabling faster transaction implementation. However, before this can occur, the project would execute the transactions out of the Ethereum network.
This is quite common in layer-2 solutions; they mainly execute transactions outside the central platform to reduce the burden and cost. So, Loopring hopes to decrease the number of transactions Ethereum has to work with, which theoretically reduces workload. With this technology, the network does not need to confirm transactions, and this will be the responsibility of the layer-2 solution.
According to the official website, Loopring is an open-source, audited, and non-custodial platform. The platform claims to scale DEXs by utilizing ZKPs, resulting in lower dependency on Ethereum. With this cryptography technology, it hopes to reduce fees for users, traders, and investors.
What Does Loopring Do?
Loopring is one of the scaling solutions created to scale Ethereum. Because of Ethereum’s ability to support decentralized applications (dApps), many projects leverage the technology. However, the massive traffic from the DeFi and NFT industries has made it very slow and expensive.
Typically, the network should execute transactions within seconds, but this is not always the case for Ethereum. Ethereum takes several minutes to perform transactions and also charges very high for them. Although firms have created many scaling solutions for this network, many have not been able to bring down gas fees.
Being a layer-2 solution, it hopes to give additional support to Ethereum-based DEXs. Without a suitable solution, the exchanges might face slower transaction settlements.
How Does Loopring Work?
Loopring utilizes unique cryptography to accomplish scalability. Primarily, the project hopes to drive DeFi adoption by making the Ethereum network more conducive. Leveraging zkRollups, known as zero-knowledge proof, can protect data due to the protocol’s unique infrastructure. With this technique, it claims to be able to settle lots of transactions within seconds.
How To Get Started On Loopring
To begin leveraging the protocol, users must send money to Loopring exchange through a smart contract. After this, it moves the transaction to an off-chain channel, which would process and execute the transaction. Finally, the project returns the transaction to Ethereum, where it confirms and finalizes the implementation. In other news, the network claims to handle lots of trades at once, making it possible for users to enjoy lower gas fees. Additionally, the zero-knowledge technique makes it possible for transactions to be settled off-chain without having access to a user’s data. This may help users stay anonymous while benefiting from the layer-2 solution.
What Is LRC Token?
LRC is the protocol’s native currency. To leverage this project, you need to buy the coin. Users interested in operating an exchange on the network need to own around 250,000 LRC, making LRC crucial for operations. Additionally, people can also stake the token to earn rewards. Staking is a popular way to make money by saving or keeping assets in a protocol to support it. Today, LRC has skyrocketed, thanks to the rumors in the crypto space regarding GameStop’s partnership with Loopring. However, it’s safe to state that it may continue rising if the rumor persists.
What Triggered Loopring’s Bullish Run
This layer-2 token has generated lots of attention and is also one of the best performers in the space. On November 10, it surged by over 60% within a day, enabling it to attain a new high. Additionally, it has moved by over 100% since the last five days due to the GameStop rumor. GameStop is a gaming merchandise retailer, and the rumors revealed that the firm is planning on creating an NFT marketplace.
Besides the market, some sources asserted that the Loopring technology would power the rumored platform. Still, nothing has been confirmed in these statements from the retailer. However, the business has been showing immense interest in the digital asset space. For one, GME has been searching for NFT and blockchain experts for a new project.
While no one can confirm the rumors, many investors are still fueling the uptrend. This is not surprising as digital asset traders can be speculative, enabling them to earn massively from positive news. Some indications also suggests that the coin would reach the $5 mark, especially with its outstanding performance. While the token is currently above the $3.5 range, possible resistance may assist the price movement.
However, since the rumors are still in the air, there is a huge possibility that the asset will continue growing. Similarly, users have been hoping to get an official statement from both GME and Loopring. None of the firms have spoken on rumors, but that doesn’t stop traders from investing massively into the coin. Thanks to new investors, the coin, valued at less than $1 a month ago, is currently above the $3.5 range.
Should You Invest In LRC?
Deciding to invest in LRC should be based on your preference. If you believe layer-2 solutions would gain more attention, you should invest in the token. However, you should only invest money you can lose to avoid significant financial losses. Also, it would help if you did your research to learn more about the project before investing in it. Loopring skyrocketed following the GameStop partnership rumor. Based on the buzz, it plans to collaborate with a crypto-related firm. However, this has not been confirmed by either of the parties.