Loopring, a second-layer solution on mainnet that day. (ETH), was used to make 40,000 transactions yesterday—that equals to 3.25% of transfers conducted on the Ethereum
“When the gas gets going, Ethereum L2 gets rolling. More Loopring zkRollup transactions yesterday than any day before. ~40k txs. That’s quite a lot,” Loopring tweeted.
The developers added that around 1.23 million transactions were conducted on the Ethereum mainnet during the same time period, thus Loopring’s transaction count was equivalent to 3.25% of that figure.
Second-layer solutions allow executing certain operations outside of the main blockchain—or “off-chain”—which, in turn, helps reduce the load on the main network. As an added bonus, layer two solutions offer faster transaction speeds and lower fees.
Loopring, in particular, is a zkRollup exchange and payment protocol. It’s an orderbook-based decentralized protocol on Ethereum that allows users to transfer their assets across various exchanges.
To achieve this, Loopring pools orders from numerous crypto exchanges and then matches them with orderbooks of all platforms that participate in the network. This way, according to its developers, Loopring cuts transaction costs to just 0.1% of those on the Ethereum mainnet.
If you need to send lots of payments on Ethereum, you need to send it on Loopring zkRollup.
Same security. Same addresses. Same tokens. >100x cheaper. https://t.co/JVuDz9iPG5
— Loopring (@loopringorg) February 4, 2021
As Decrypt reported, the average Ethereum transaction fee exceeded $23 on February 5, reaching a new all-time. In this light, transactions and decentralized applications on Ethereum are becoming increasingly more expensive.
As a result, trading on decentralized exchanges, such as Uniswap, has become increasingly expensive in the last few weeks. Executing trades can cost $50 or more.
Cost of usage increases with gas fees, which aren't directly tied to ETH price, but rather to demand for layer 1 blockchain space. The two are certainly correlated. This has long been a focus in crypto – ethereum (and all layer 1s) need to move most transactions off of layer 1.
— Ari Paul (@AriDavidPaul) February 8, 2021
“Cost of usage increases with gas fees, which aren’t directly tied to ETH price, but rather to demand for layer 1 blockchain space. The two are certainly correlated. This has long been a focus in crypto – ethereum (and all layer 1s) need to move most transactions off of layer 1,” recently wrote Ari Paul, co-founder and chief investment officer of BlockTower Capital.
Considering Loopring’s latest achievement, it looks like many users agree with him.