Decentralized finance cost and liquidity token Loopring (CRYPTO:LRC) within the week after reaching an all-time excessive of $3.72 it touched on Nov. 10 tumbled about 38%, though it has since recovered a few of the losses.
What’s attention-grabbing is that there there are some hints of intriguing optimistic catalysts, together with a doable alliance with one of many world’s most infamous meme shares. The hypothesis is obscure and unsure at this level, however Loopring could have the potential for a powerful rise within the coming weeks, and lasting beneficial properties over the long run.
Loopring has utility
Loopring is a protocol that operates on prime of an current system, providing excessive ranges of safety in a totally decentralized format, together with an related cryptocurrency native token. In accordance with its web site description, Loopring goals to make it so customers needn’t “select between safety and efficiency,” whereas providing “a low-fee, high-speed platform for buying and selling, swapping, liquidity offering, and funds.”
It is based mostly on the Ethereum (CRYPTO:ETH) blockchain, already famous for its top-notch safety, however utilizing what’s referred to as Layer 2 (which carries out transactions off the blockchain to keep away from congestion) avoids Ethereum’s slowness and excessive charges. Further options and utilities are below growth.
Loopring’s preliminary coin providing was again in 2017, whereas its primary web deployment occurred close to the top of 2019. With cryptocurrency charges very excessive on many platforms, Loopring’s low charges and quick processing instances laid the groundwork for its widespread adoption and use. Its absolutely decentralized nature additionally guarantees to maintain transactions and property utilizing its protocols protected from third-party interference, together with, theoretically, meddling by governments.
Rumors of a Loopring and GameStop merger
There’s scuttlebutt on cryptocurrency boards about the potential for a partnership or perhaps a merger between Loopring and meme stock GameStop (NYSE:GME). The online game and gear retailer is slowly dragging itself again from the abyss of near-bankruptcy, thanks in no small measure to the WallStreetBets’ military of retail traders and the quick squeeze they triggered earlier this yr. GameStop was in a position to money in when its shares soared with a big inventory providing, significantly boosting liquidity, although it is nonetheless casting about for a brand new enterprise mannequin that may carry it into the longer term.
Customers on the Reddit subforum r/SuperStonk noticed Loopring Chief Government Officer Daniel Wang shifting a big bloc of Loopring cryptocurrency, probably a part of his personal private holdings, from Layer 1 to Layer 2 . This was interpreted by the Redditors who initially found the information as offering liquidity for the launch of a GameStop non-fungible token (NFT) market utilizing the Loopring protocol. One Reddit consumer discovered an NFT being minted by an tackle related to nft.gamestop.com, in keeping with Rarible information. CoinDesk additionally reported that code involving GameStop is within the works at Loopring, a growth confirmed by Powerbomb Finance’s founder Dennis Hui.
Maybe extra considerably, GameStop posted eight NFT-related jobs on its profession web page in late October, in keeping with Enterprise Insider, with the listings stating an “very best candidate could have expertise throughout a number of domains in gaming, content material creation, partnerships, recreation design/growth/mechanics, and a basic understanding and expertise with Ethereum, NFTs, and blockchain based mostly gaming platforms.”
Nonetheless, at this level, all that’s obtainable is theory and guesswork connecting all of the items, although some occasions, such because the switch of the CEO’s tokens to Layer 2, are verifiable. That transfer is seen on Etherscan, which supplies a report of token transfers, and reveals massive current shifts by the pockets “danielwang.eth.” The NFT job listings additionally existed.
Whether or not all these information factors actually sign a future GameStop-Loopring pact is unclear. Nonetheless, these nuggets of data might be vital in serving to traders resolve whether or not to purchase into Loopring now.
Wanting previous the rumors
There is a saying amongst cryptocurrency fanatics borrowed from inventory merchants: “Purchase the rumor, promote the information.” This axiom was definitely confirmed true this previous summer season within the case of meme token Dogecoin (CRYPTO:DOGE), which soared on stories of unspecified however optimistic actions from Tesla CEO Elon Musk. After Musk truly spoke about Dogecoin, the coin tumbled to a few third of its all-time excessive.
Although Loopring is certainly dangerous, now is likely to be the time to purchase and get forward of the hypothesis. The dilemma is likely to be what to do ought to a deal come about. Loopring has a number of sturdy utilities constructed into it, not like earlier, less complicated cryptocurrencies corresponding to Dogecoin. So promoting ought to a take care of GameStop occur may not be the very best transfer, past a doable partial sale for profit-taking.
Loopring has the identical qualities that make some cryptocurrencies genuinely useful, and stands a very good likelihood of rising in worth through the subsequent few quarters. A GameStop alliance or merger may speed up that course of, however Loopring may effectively take off even with no meme inventory connection.
This text represents the opinion of the author, who could disagree with the “official” advice place of a Motley Idiot premium advisory service. We’re motley! Questioning an investing thesis — even considered one of our personal — helps us all assume critically about investing and make choices that assist us develop into smarter, happier, and richer.