Your guide to Loopring, how it works and how you can buy the LRC cryptocurrency.
Loopring is a decentralised exchange and open protocol on the Ethereum blockchain. It’s designed to provide traders and institutions with a decentralised, automated trade execution system that implements trades across crypto exchanges, ensuring protection from counterparty risk and reducing the cost of trading.
The LRC token is the native token of the Loopring system, so let’s take a closer look at what these tokens are used for and how you can buy LRC in Indonesia.
Where can I buy LRC?
You can buy and sell LRC on a wide range of popular cryptocurrency exchanges, including:
How to buy LRC
If you want to buy LRC, this is how to do it:
Step 1. Create an account on a cryptocurrency exchange that allows you to trade LRC
Do your research to find an exchange that offers LRC in the currency pairing you want to trade, and then sign up for an account with that exchange online. You’ll need to provide your name and email address to register and, to comply with Know Your Customer laws, some exchanges will require further contact details and proof of ID before you can begin trading.
It’s also recommended that you setup two-factor authentication on your account for added security.
Step 2. Deposit funds into your account
At the time of writing, there was no crypto exchange that allowed you to exchange Indonesian rupiah (IDR) for LRC directly, so you’ll need to own or buy a popular currency, such as Bitcoin (BTC) or Ethereum (ETH), before you can acquire any LRC.
To deposit funds, login to your account and click on the “Deposit” link. Enter the amount you want to deposit and generate a wallet address to transfer your chosen crypto from another exchange or your own wallet into your account.
Step 3. Buy LRC
Now it’s time to exchange your chosen crypto for LRC. The steps you’ll need to complete to do this may vary slightly between exchanges, but you’ll generally need to search for your desired pairing (such as ETH/LRC) and click on “Buy LRC”.
You can then enter the amount of LRC you want to buy and, if you’re happy with the transaction details and total cost, confirm your purchase.
How to sell LRC
If or when you decide to sell your LRC, you can do so via your chosen crypto exchange. You’ll essentially need to follow the same process as in step 3 above, but with the obvious difference that you’ll be looking to sell rather than buy. You should also be aware that exchanges don’t offer every possible crypto pairing, so you may not be able to directly exchange LRC for the currency you want.
Storing cryptocurrency on an exchange for any length of time is not recommended, so you should consider transferring your LRC to a wallet. LRC is an ERC20 token on the Ethereum blockchain, so you’ll need to store your LRC in an Ethereum-friendly wallet. Examples of suitable wallets include:
How Loopring works
The main aim of Loopring is to solve the problems associated with centralised cryptocurrency exchanges. Despite the fact that cryptocurrencies are designed to be decentralised, most people still buy, sell and trade cryptos on centralised platforms. Not only does this expose us to an increased risk of fraud and a lack of transparency, it also means higher transaction fees and, in recent times, inconvenience as several exchanges have struggled to keep pace with rising demand.
Loopring is a decentralised exchange protocol, but not a decentralised exchange as such, for ERC20 tokens. By acting as an automated trading interface between crypto exchanges and blockchains, its role is to implement a user’s trades across the world’s crypto exchanges, providing protection against counterparty risk and reducing trading costs.
The Loopring system allows traders to retain control of their tokens rather than sending them to an exchange, with smart contracts used to automatically execute trades while the funds remain under your control. Loopring is designed to break each order into small pieces, identify the best exchanges and times to trade those pieces, and apply game theory logic to produce the best trading results.
Ethereum is the first public blockchain to be supported by Loopring, but the protocol is designed to be blockchain-agnostic, so other blockchains with smart contract capability could also be supported in future.
The Loopring concept was first developed in 2016 and its whitepaper was published in May 2017. An ICO took place in August 2017, and raised $US45 million in funds.
What to consider when buying LRC
Cryptocurrencies are complex, speculative and risky, so you’ll need to thoroughly research any coin before you decide to buy. If you’re thinking of buying LRC, make sure you take the following factors into account:
- Supply. According to CoinMarketCap, at the time of writing (25/01/2018) there was a circulating supply of 561,169,913 LRC, out of a total supply of 1,374,956,857 LRC.
- Use. LRC tokens function in a similar way to Ethereum’s gas. It will be used to pay transaction fees, reward miners and pay for other service fees. LRC holders also enjoy discounted trading fees and can vote on important matters in the protocol.
- Decentralisation. Bitcoin and other cryptos were established so that people could trade units of value without having to trust a centralised authority like a bank. Most of today’s crypto exchanges are still centralised, exposing users to the risk of fraud and hacking, so a move towards the decentralisation of exchanges does seem like a logical next step.
- Growth. Initially only for ERC20 tokens on the Ethereum blockchain, the Loopring protocol is blockchain-agnostic. This means it can potentially support other blockchains with smart contract capability, such as NEO, Qtum and EOS, in the future.
- Future developments. For details of future developments and upgrades to Loopring, check out the Roadmap on the Loopring website. While you’re there, download the whitepaper for a detailed explanation of how the protocol and LRC tokens work.
- Competition. You’ll also need to consider the market competition Loopring may face, not only from the more traditional centralised exchanges, but also from projects such as KyberNetwork and 0x.