A step-by-step guide to buying the Loom Network’s LOOM token.
A blockchain platform for large-scale online games and social apps, Loom Network is built on Ethereum. Using what it calls DAppChains, which are full-featured blockchains built to run in parallel to Ethereum Smart Contracts, Loom Network is building an infrastructure platform designed to help Ethereum scale.
The Loom Network was officially launched in March 2018, and so too was its LOOM token, which acts as a network membership token. If you want to buy LOOM but don’t know where to start, we’ve put together this simple, step-by-step guide.
Where to buy LOOM in Canada
You can find LOOM listed on the following cryptocurrency exchanges:
Quick guide to buying LOOM
- Register for an account with Binance.
- Enable 2-factor authentication.
- Click on “Funds” and select “Deposits”.
- Select “Deposit coin”.
- Copy the wallet address or scan the QR code.
- Transfer BTC or ETH into your account.
- Click “Exchange” and select “Basic”.
- Search for the pair you want to trade, such as “LOOM/ETH”.
- Select a Limit, Market or Stop-Limit Order.
- Enter the amount of LOOM you want to buy.
- Review transaction details.
- Click “Buy LOOM”.
A step-by-step guide to buying LOOM
To buy LOOM tokens, complete the following steps:
Step 1. Register on an exchange that lists LOOM in one or more currency pairs.
LOOM tokens are only available on a selected range of exchanges, so compare the platforms that support LOOM to find one that meets your needs. You’ll need to provide your email address and create a password to register, while some exchanges will also require you to supply additional personal information and proof of ID to satisfy Know Your Customer and anti-money laundering (KYC/AML) regulations.
Before depositing any funds, remember to enable 2-factor authentication to provide increased security for your account.
Step 2. Deposit funds into your account.
There’s currently no way to buy LOOM directly with Canadian dollars, so you’ll need to first obtain a cryptocurrency listed in a trading pair with LOOM. Your options are bitcoin (BTC), Ether (ETH) and Binance Coin (BNB). If you need help getting your hands on any of these currencies, check out our how to buy BTC, how to buy ETH and how to buy BNB guides.
To deposit the funds into your account, you’ll need to find and copy your exchange wallet’s transfer address. For example, if you’re using Binance, click on “Funds” at the top of the screen and select “Deposits” from the drop-down menu. Select the coin you want to deposit, scan the wallet QR code or copy the relevant address, and then transfer coins into your account.
Step 3. Buy LOOM.
Now it’s time to find the Exchange section of your chosen platform, search for the pair you want to trade (for example LOOM/ETH) and buy some tokens.
If you’re using Binance, click “Exchange” from the menu at the top of screen and select whether you want the Basic or Advanced trading view. Search for your chosen trading pair, look for the “Buy LOOM” box and then choose whether you want to place a Market, Limit or Stop-Limit Order.
Enter the details of your transaction, such as the amount of LOOM you want to buy or your desired price. Make sure you then review the full transaction details before finalizing your purchase.
How to sell LOOM
If you decide you want to sell your LOOM tokens, the process you’ll need to follow is essentially the same as that outlined in Step 3. For example, if you’re using Binance, after navigating to the Exchange page and searching for your desired trading pair, look for the “Sell LOOM” box on the right of screen. You can then enter your transaction details and click on “Sell LOOM”.
Make sure to once again check the full details of the transaction before submitting, and remember that you may not be able to immediately exchange LOOM for the currency you want.
Which wallets can I use to hold LOOM?
Although you could potentially store your tokens on an exchange, this would expose you to the risk of hacking and theft. Moving LOOM into a private wallet that you own is generally considered to be a much more secure option.
As LOOM is an ERC20 token on the Ethereum network, you’ll need to look for a wallet that supports these types of tokens. Options you may consider include hardware wallets like the Ledger Nano S and TREZOR, or the MyEtherWallet web interface.
How LOOM and the Loom Network work
Describing itself as “EOS on top of Ethereum”, Loom Network is developing a platform designed to help Ethereum scale. Its key product is a software development kit (SDK) which developers can use to create their own blockchain without needing any specialized knowledge of blockchain technology.
This SDK develops what Loom Network labels a DAppChain, which runs as its own sidechain to Ethereum’s base layer. This structure allows DAppChains to use different consensus systems, for example Delegated Proof of Stake (DPoS), but also allows assets based on these chains to enjoy all of the security benefits of Ethereum.
With support for DPoS as standard, the two initial types of dapps the network is focusing on are large-scale online games and social apps. Loom Network’s first dapp was launched in March 2018. Known as DelegateCall.com, it’s a Q&A site all about blockchain and Ethereum programming.
The Loom Network’s SDK is currently in private beta testing and will have its public release in June 2018. The team behind the project has raised US$25 million in funding and is led by co-founders James Duffy, Luke Zhang and Matthew Campbell.
What to consider if buying LOOM
Cryptocurrencies are complex and speculative, and are notorious for their volatility. Before buying any digital currency, make sure you thoroughly research the project and all of the factors that could potentially affect its price.
If you’re thinking of buying any LOOM, take the following issues into consideration:
- Supply. According to CoinMarketCap, at time of writing in May 2018, the circulating supply of LOOM was 578,741,601, out of a total supply of 1 billion.
- Use. The LOOM token is a membership token described as an all-access pass to dapps running on the Loom Network. The tokens work across all DAppChains running on the network and allow you to transfer your data and digital assets between Loom DAppChains and Ethereum.
- Membership tiers. Currently, Loom Network only has one membership tier, the user tier, which requires you to hold one token before you can participate. However, there are future plans to announce higher membership tiers for developers who want to build and run dapps. To qualify for those tiers, you’ll need to hold a larger token balance.
- No whitepaper. Critics of Loom Network have suggested that the fact that the project doesn’t have a whitepaper should raise red flags for crypto buyers. Responding in a blog post, Loom Network co-founder James Duffy said: “It didn’t make sense to us to publish in-depth documentation for a product that didn’t exist yet – so we figured we’d build the product first, get a bunch of developers building dapps on it second, and then release the in-depth documentation.”
- CryptoZombies. Loom Network is also behind CryptoZombies, an interactive code school designed to teach developers how to write smart contracts in Ethereum’s Solidity programming language. The school has had more than 170,000 users and is in the process of being converted into a DAppChain. Loom is also developing three dapps in-house that are scheduled for release in Q2 2018.
It’s still early days for Loom Network, so whether or not it can become a popular dapp platform among developers remains to be seen. Make sure you thoroughly research the project before deciding whether or not to buy any LOOM tokens.
Disclosure: At the time of writing, the author holds IOTA and XLM.