Complete Guide To LRC: Loopring DeFi Protocol & LRC Token Explained

The global blockchain market will be worth $1,431.54 billion by 2030, with the market constantly expanding and reaching new heights. And while there are different types of blockchain protocols, not all of them were created equally.

If you want to get into crypto, you need to know about different blockchain protocols, one of which is Loopring. 

This protocol offers high levels of security and it has a governance token by the same name, the LRC Token. If you want to learn more about the world of LRC Loopring, you’ve come to the right place.

What is Loopring?

With the number of assets that kept growing on the blockchain, a software engineer named Daniel Wang decided to develop a technology that would parallel the growing use of these assets.

In 2014, he and his team started to develop a platform that would solve some of the issues that were present in decentralized and centralized exchanges. In December 2019, the protocol was deployed, which was initially done on the Ethereum mainnet.

The beauty of Loopring is that it aims to combine decentralized on-blockchain order settlement with centralized order matching into one hybridized product.

This is done in order to get the best of both worlds. In centralized crypto exchanges, many users are buying and selling assets that are in demand at fast-paced speeds. And in decentralized exchanges, liquidity levels are lower since order matching doesn’t happen so quickly.

This means that it gives investors the benefits of decentralized exchanges, meaning that they aren’t custodial and give more control to investors over their assets, just like in a decentralized exchange. And it manages to do all of this while keeping the efficiency of a centralized exchange.

How does Loopring work?

Loopring is a payment application and it’s also referred to as the world’s first Ethereum smart wallet. It’s important to know what type of crypto wallet is the most suitable, and Loopring is great for those looking for a wallet that is both safe and cutting-edge.

Unlike other wallets, it’s not managed by a private key. Instead, it’s managed by a smart contract, including:

  • Mix-matched contracts, which manage order statuses and monitor the prices and volume of the transactions while ensuring all smart contracts are communicating with one another.
  • Order contracts, which are in charge of cancellations and maintaining the order databases.
  • Registration contracts, which manage the services for all exchanges that are implementing the Loopring token deposits and platform.
  • Stats contracts, which determine the prices between exchange volumes and token pairs.

Loopring also integrates a data link layer into its protocol. This is done to avoid the high fees and slow speeds of the Ethereum blockchain, which is what Loopring is built upon.

Thanks to this link layer, users can easily send assets to an Ethereum address and secure the transaction by using a trusted third party as the transaction’s guardian. As a bonus, those who are using the Loopring wallet avoid high fees as they only pay 1% of Ethereum Layer 1 fees.

What is LRC and how can you buy it?

Loopring (LRC) is Loopring Protocol’s governance token. It’s an ERC-20 token and one of the seven tokens that are currently located in the Index Coop’s DeFi Pulse Index (DPI).

You can buy LRC by buying DPI, which you can do directly from the Index Coop. You do this by connecting your digital wallet to the Index Coop app.

It’s also possible to exchange a fiat currency directly for DPI. To do that, you will need to have an Ethereum wallet such as Gemini, Rainbow, or Argent. These wallets connect either to your debit card or bank account, and by using them you can exchange fiat currencies for DPI.

How can you trade with Loopring?

To initiate trading, you need to place your order via a Loopring wallet. To sign up, you need to use your private wallet key, and when you do this, your funds will be transferred. This is because Loopring functions as the interface where your funds are managed.

When you place an order, it is communicated to the smart contracts on the platform and then forwarded to off-chain relay nodes after which they are matched. As soon as this is done, your order is confirmed and it’s ready for execution.

In the final step, the smart contracts will exchange the funds in your wallet for your preferred currency.


The Loopring protocol is backed by a large community of people who see all of the benefits it provides. In addition, it’s consonantly growing and adding new features. For crypto lovers who are tired of dealing with low scaling rates and high transaction fees, Loopring is the perfect solution.