Loopring (LRC)

What is Loopring

Loopring is an open protocol for building decentralized exchanges. Loopring operates as a public set of smart contracts responsible for trade and settlement, with an off-chain group of actors aggregating and communicating orders. The protocol is free, extensible, and serves as a standardized building block for decentralized applications (dApps) that incorporate exchange functionality. Its interoperable standards facilitate trustless, anonymous trading. An important improvement over current decentralized exchange protocols is the ability for orders to be mix-and-matched with other, dissimilar orders, obviating the constraints of two-token trading pairs and drastically improving liquidity.

Loopring also employs a unique and robust solution to prevent front-running: the unfair attempt to submit transactions into a block quicker than the original solution provider. Loopring is blockchain agnostic, and deployable on any blockchain with smart contract functionality.

Loopring is not a DEX, but a modular protocol for building DEXs on multiple blockchains. We disassemble the component parts of a traditional exchange and offer a set of public smart contracts and decentralized actors in its place. The roles in the network include wallets, relays, liquidity-sharing consortium blockchains, order book browsers, Ring-Miners, and asset tokenization services. Before defining each, we should first understand Loopring orders.

The Loopring protocol sets out to be a foundational layer for decentralized exchange. In so doing, it has profound repurcussions in how people exchange assets and value. Money, as an intermediate commodity, facilitates or replaces barter exchange and solves the double coincidence of wants problem, whereby two counterparties must desire each other’s distinct good or service. Similarly, Loopring protocol aims to dispense of our dependencies on coincidence of wants in trading pairs, by using ring matching to more easily consummate trades. This is meaningful for how society and markets exchange tokens, traditional assets, and beyond. Indeed, just as decentralized cryptocurrencies pose threat to a nation’s control over money, a combinatorial protocol that can match traders (consumers/producers) at scale, is a theoretical threat to the concept of money itself.

Protocol benefits include: