If you’ve checked gas prices on Ethereum lately, you understand exactly why we need Layer-2 (L2) solutions implemented with DeFi applications as soon as possible! When we talk about the Ethereum blockchain, Layer-1 refers to the the underlying main blockchain architecture, which is mainly where we find every application built as of today.
When we talk about Layer-2, it is a collective term for solutions designed to help scale your application by handling transactions off the main Ethereum chain (Layer-1). Transaction speeds suffer when the network is busy which can make the user experience poor for many dapps, especially in DeFi. And as the Ethereum network gets busier, gas prices increase as transaction senders aim to outbid each other to get their transactions confirmed. This ultimately can make using Ethereum very expensive.
Thankfully, some brilliant minds have been working to address these network issues for many years, one of which is the team at Loopring.
Loopring is an Ethereum zkRollup protocol: an L2 scaling solution. Loopring’s L2 increases transaction throughput and decreases cost, while maintaining complete Ethereum security guarantees. Loopring’s zkRollup supports token transfers, orderbook exchanges, and AMM (automated market maker) exchanges.
In addition to being an open source Loopring Protocol, Loopring also built Loopring Exchange – an orderbook and AMM DEX, and Loopring Wallet – a mobile smart contract wallet. From the perspective of users, Loopring allows instant and gas-free transfers, trades, and liquidity provision.
Loopring users deposit their assets on-chain into a zkRollup smart contract and users will later withdraw their assets from Loopring L2 to Ethereum L1.. Transactions occur off-chain, which enables remarkably fast transactions (2000 TPS) for fractions of a penny per trade in gas, which feels more like a traditional crypto exchange UX–just click and confirm orders within less than a second.
While Loopring’s ICO raise was about 3 years ago, Loopring DEX has been live for nearly one year with over $75M in total value locked. Recently, Loopring launched recently launched Loopring Exchange v2 (exchange.loopring.io) based on Loopring Protocol 3.6. They also launched the Loopring Wallet Android app and integrated the AMM swap natively–essentially an AMM in your pocket, trading at 2000 TPS for fractions of a penny per trade in gas costs.
How to Earn Up to 75-230% APY* Liquidity Mining on Loopring AMM Built on L2
Please be aware the estimated APYs above are based on the liquidity of the 3 LPs around 12 am EST on Jan 6th 2020 with LRC/USD price about $0.50. When liquidity or price changes, these APYs can go up or down drastically. For example, if LRC falls in price by 50%, APY falls to 35%-115%.
In light of the recently launching the native AMM swap on Loopring DEX, to encourage the Ethereum community to move to Layer-2, Loopring will initiate an L2 AMM Liquidity Mining program starting at 11 am EST on January 5th, 2021 for 14 days, where 400,000 LRC will be rewarded proportionally to LPs in each of the 3 AMM pools:
- ETH<>LRC (currently ~$7M in liquidity)
- ETH<>WBTC (currently ~$5.4M in liquidity)
- ETH<>USDT (currently $2.2M in liquidity)
Depending on how much liquidity is deposited into these pools and the price of LRC, which is Loopring’s protocol token used in…
Hi! My name is Lark Davis!
I’m a cryptocurrency investor with years of experience and I’ve been making consistent profits in the crypto space.
I’m passionate about helping others do the same, so I run multiple educational channels on crypto investing.
