Loopring (LRC) - Not much talked about, but possibly the most exciting and undervalued DEX protocol - Cross-chain swaps possible - Da Hongfei as advisor

in cryptocurrency •  3 months ago


Now that my hardware wallet is set up, I can finally delve into the newer coins that came onto the market. I've had my eye on a few of them but unfortunately most of them seem to have risen by quite a lot already (Chainlink, Kyber, Walton, etc.). One coin is still under the radar, yet it shows amazing promise: Loopring (LRC).

Loopring is a decentralized exchange and open protocol. Much like 0x, for example, Loopring offers a protocol ontop of which other parties can build their exchanges. What sets Loopring apart is that it has some unique features that it's competitors seem to lack. Most notably the feature of being blockchain agnostic: cross-chain swaps between different blockchains will be possible. This means that, for example, an exchange could offer an ETH/BTC pairing, or a NEO/DASH pairing, or any other kind, whereas the competition will only offer ERC20 based token trading. This is rather huge.

Furthermore, the way Loopring works is that it provides underlying architecture and protocols to build exchanges on. These exchanges then share from the common liquidity pool of the entire Loopring network. In essence it means that if an order cannot be filled on one exchange, the protocol automatically fills it on another. This will improve stability, guard against flash crashes and provide increased liquidity overall.

The Loopring mechanism also allows for a sort of order-matching, which is a feature Decentralized Exchanges are struggling with. Additionally, Loopring is of course Decentralized and anything built on top of it will trade peer-to-peer, as such your funds are always under your own control.

If you look around online, you'll find quite some excitement over the team that is building Loopring. The Loopring developers seem to have an impressive background as Google Senior Tech Leads, or having worked with PayPal. What is interesting to me is that many people are listed on the Team page but it appears that there are only 3 actual team members. The majority of people listed are listed as communitymembers/developers. Regardless, there too you will find many people with backgrounds in working at Google or the Bank of China.

Yes, it's a thing nowadays: Advisors. Preferrably Vitalik Buterin it seems, but Da Hongfei is quickly catching up! Da Hongfei of NEO is highlighted as one of the main advisors to the Loopring project. This is seen as a rather huge reason to invest in Loopring for many. Da Hongfei is an advisor to some other projects, most notably Binance, which is succesful. Additionally you will find advisors from all kinds of big names, ranging from Baidu to PayPal. It is an impressive list of resume's to be sure.


Most important to investors are perhaps the token functions and value-proposition. It is simple: LRC is used for all transactions on an exchange (either directly or 'under the hood'). Additionally the whitepaper states that exchanges with a high turnover will be able to deposit LRC in a smart contract in order to increase the exchanges' credibility and ward against adverse circumstances. How this is supposed to work, I am not sure. However, LRC being used for transactions on the Loopring network is enough of a reason for me to see value: every single exchange goes through millions of trade volume every day, and for each trade some LRC will be spent. I can see the demand for LRC being enormous if adoption is big enough. With cross-chain swaps, I believe Loopring has enough of an edge to outcompete the competition and indeed capture a significant portion of the DEX-market.

I would've loved to get into Kyber as I think it's a great project, but it's market cap is rather big already and I am doubtful it will be able to grow by a lot because of this, despite it's popularity. 0x is currently very cheap, and I'm tempted to buy, but it appears Loopring is just simply better. Not to mention that it's backed by Da Hongfei, which makes me believe that this could become a serious player in China. Loopring offers great growth potential: at a market cap of $74 million it is currently the cheapest of the DEX options out there, and quite possibly one of the most exciting ones.

It only trades on a few exchanges, which makes it harder to get, but it also means you can get in cheaper than if you wait for the big exchanges.

I decided to get in yesterday and bought my first few LRC on Etherdelta. Am planning to hold this one for a while.

Want to read more? Go visit the Loopring website

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