Many of us have heard about the potential GME partnership with the cryptocurrency Loopring, but do not have any idea about why this could be a game changer for both GME and Loopring.
I have tried my best to provide a clearer breakdown to help anyone trying to understand why many of us are very excited by the news that GME maybe have partnered with Loopring.
What is Loopring?
Loopring is an Ethereum Layer-2 scaling protocol that enables the building of decentralized exchanges, which rival centralized exchanges in terms of performance. It allows users to trade without the need for a custodian or intermediary. A decentralised exchange allows users to trade their assets (normally cryptocurrency) without having the need to fill out KYC regulation forms.
Loopring has a cryptocurrency token which goes by the symbol LRC. Loopring has currently an exchange built (https://app.loopring.info), an smart wallet to hold your cryptocurrencies in, and aims to become the leading user-facing financial services application in the world.
Ethereum is open access to digital money and data-friendly services for everyone – no matter your background or location. Its token is goes by the symbol ETH. Ethereum allows you to move money, or make agreements without directly having to go to someone else (No need for banks or payment providers). The middleman is taken out of the picture. It is decentralised – meaning it makes it nearly impossible to stop you from receiving or using services on Ethereum. All transactions are stored on an electronic ledger, allowing you to keep track of all your transactions. It is also the main network for NFT’s, which are taking the world by storm (see below for more information on NFT’s.)
Ether (ETH) is the main token of the Ethereum blockchain and acts as the primary “fuel” that powers all activity on it. Ethereum uses “Gas” for transactions. ‘Gas’ refers to an amount of ether that’s needed to perform a certain function on the network.
Ethereum is the second biggest cryptocurrency, just behind Bitcoin. It is known as the financial cryptocurrency of the world. It is expected to overtake Bitcoin (also known as the ‘flippening’) and should become the number one cryptocurrency used worldwide.
Companies Who Are Bullish on Ethereum: Google, Tesla, Square, PayPal, ARK, Mastercard, MetLife, Cisco, BP, Accenture, Microsoft, IBM, JPMorgan Chase, Deloitte, Barclays, UBS, Credit Suisse, Amazon, Visa (the list goes on and on).
While I could go on about the large list of functions Ethereum has, I think a brief outline above gives a clear meaning to what is Ethereum.
The Problem with Ethereum
As there are millions of users using Ethereum, ‘Gas’ prices can rocket, meaning that it can be very expensive to buy or sell cryptocurrency.
Ethereum is a Layer 1 Protocol, and this means gas prices can skyrocket if lots of people are buying and selling cryptocurrency at the same time. It is based on supply and demand. The more demand, the most costly it is for someone to carry out a transaction. The Ethereum network picks the transaction with the highest gas fee, and processes the transaction in that order. This means transactions for users who pay a lower gas fee can take much longer to process (hours, or days).
How much gas you pay for each action on the Ethereum blockchain is calculated based on two things:
Gas cost x Gas price = Cost of an operation on Ethereum
High gas costs are the biggest issue users who buy and sell cryptocurrency face with Ethereum, as the costs are too high.
If the problem of high Gas fees can be solved, the usage of the Ethereum network will rocket to unprecedented levels.
How do you fix the Gas problem? Where does Loopring come in?
As Ethereum is a layer 1 protocol, it sends transactions one by one. This puts a lot of strain on the Ethereum network, and therefore, the network prioritises those who are willing to pay a higher ‘Gas’ fee. We can fix this by using a Layer 2 Protocol.
Loopring is a Layer 2 Protocol.
Loopring uses a scaling solution called ‘zkRollups’. This is where Loopring bundles lots and lots of transactions together off-chain, before submitting them to the Ethereum network as a single transaction. This means less strain is placed on the Ethereum network, and therefore makes trades on Loopring much faster and cheaper.
Its innovative use of zkRollups allows it to achieve higher throughput and lower costs than any other decentralized exchange built on the Ethereum blockchain, while its non-custodial technology presents an improvement to the security of centralized exchanges.
This means you only have to pay fees when interacting with the Ethereum chain directly — including deposits, withdrawals, and registering a new account. Trades and transfers made within the Loopring zkRollup do not require any gas (and are nearly instant). This makes your transaction costs much lower than anywhere else.
Loopring also benefits from the security of the Ethereum network, but also enhances user protection. Unlike most other cryptocurrency exchanges, if anything ever happened to Loopring, your funds are always safe and withdrawable back to Ethereum, even if Loopring does not exist.
Ethereum’s Founder Billionaire Vitalik Buterin says ‘Layer 2 Solutions Are the Future of Ethereum Scaling’. He also mentioned NFT’s need to move on to Layer 2 solutions to cut fees.
This is what makes Loopring so valuable.
Best places to buy Loopring (LRC)
It is available to purchase on the following exchanges, just to name a few:
There are many more exchanges, but these are the most common exchanges. Loopring and Coinbase are the most recognised.
What are NFT’s?
NFT’s (which GME is aiming to roll out) are currently taking the digital art and collectibles world by storm. NFTs are tokens that we can use to represent ownership of unique items. They let us tokenise things like art, collectibles, even real estate. They can only have one official owner at a time, and they’re secured by the Ethereum blockchain – no one can modify the record of ownership or copy/paste a new NFT into existence.
NFT’s are currently selling for large amounts of money. For example, a collection of 10000 NFT’s ‘sold’ for $530 million.
Where does GME fit into all of this?
GME is creating a NFT marketplace. You can see this here: https://nft.gamestop.com/
If GameStop can establish themselves as owners of a leading global NFT marketplace, it will create an incredible new revenue stream for Gamestop, and hopefully this will reflect on the share price.
Web 3, Ethereum, Cryptocurrency and NFT’s are the future, and GME have placed 8 job adverts looking for workers with experience of “Ethereum, NFTs and blockchain-based gaming platforms.”
If GME gets this correct, this could mean be very bullish.
GME and Loopring – why is everyone getting excited and buying Loopring and more GME?
If GME is using Loopring’s technology to power their NFT platform, they won’t just be providing a basic NFT platform to GameStop users.
GameStop would be combining the speed, security and reliability of Loopring’s Layer 2 platform protocol, with the worldwide audience GME has. It allows GameStop to become dominant in the NFT space, and with the NFT space expected to grow, this can only be good news for GME’s share price.
Its like combining the Rolls Royce of Layer 2 protocols, with the bullish potential of what GME could evolve into. It means GME is working with one of the best in the game, and this will attract users to use the potential platform, as they can benefit from lower fees, fast transactions, and world class security.
Loopring has announced they are working with a “partner” to developed an NFT marketplace, and it aims to release the news in Q4 2021. This lines up with the rumoured launch date for the GameStop marketplace.
GameStop’s Head of Crypto used to work at Loopring, which further enhances the rumours that a partnership is coming. This, along with the code found in Loopring’s GitHub, outlining the GameStop API, is bullish both for GME and Loopring.
What do I think will happen?
Of course, these are my thoughts and make sure you DYOR. I think Loopring will rise anyway. It’s all time high was over $2.40, and is currently sitting at $0.56. With GME and if the partnership is confirmed, I believe it could rocket to a top 10 cryptocurrency coin between $30-$50+ a coin or even higher, which is why I hold Loopring (LRC). I believe it’s going to rocket up in value, and if GME does partner with them, it’s going to moon hard! Loopring is also valuable as it deflationary. This means the total LRC supply decreases over time which can impact Loopring’s token price and market cap positively. With cryptocurrency, volatility is why people invest in it. When something moons, it goes to unbelievable levels – just look at Bitcoin and Ethereum.
For GME, I think having such a solid infrastructure shows growth, and will allow GME to establish themselves as a global leader in the NFT space. This should propel GME’s share price much higher. By diversifying into NFT’s, with an incredible layer 2 protocol behind it, Gamestop will be able to benefit from its partnerships with Hasbro and Microsoft, allowing it to become dominant in the NFT space. With many game studios looking for a solid NFT marketplace to mint their NFT’s, a successful Gamestop NFT marketplace would be the perfect place for them to do this, thus bringing in huge revenues for Gamestop.
I hope it helps clear things up a little better for everybody wondering why GME and Loopring could be huge news for both.
(I came across this post on Superstonk by Redditor Delvo14827 could not crosspost so copypasted it)