Ever since the ‘Crypto Tsunami’ really hit our shores in 2017, we have seen numerous cryptocurrencies flooding the crypto space. Even though the exponential growth of the crypto community is exceptional but we have also seen attacks on crypto exchanges and a few scams that really pressed the need for decentralized cryptocurrency exchanges.
Many crypto influencers and enthusiasts term the centralization of crypto exchanges as ‘antithetical’, Loopring, a decentralized exchange protocol is the solution the world needs right now. I talked to the Co-Founder and CMO of Loopring, Jay Zhou as he told BlockPublisher about the latest developments at Loopring and how they’ve figured out a way to solve the scalability problem.
- Tell us how you came up with the name Loopring?
Jay: Daniel Wang, the founder and CEO came up with the idea behind the Loopring technology. We researched about the idea for quiet a while and then one day, me and Daniel were sitting in Starbucks to pick a nice name for the organization. You know Loopring introduced a very new technology called re-match, meaning we can circulate multiple orders in to one transaction just like a circle. So Loopring can actually be broken down to Loop+Ring, meaning how we circulate all orders in one ring and that’s how we came up with the name.
- Please tell our audience about other partners Loopring has since you are co-founder and CMO of the company.
Jay: We are three partners, one is Daniel who is also our CEO and ‘tech guru’ and he used to work for Google in the US. Back in 2010, IDG Ventures funded Daniel to setup a centralized cryptocurrency exchange. But unfortunately in 2014 Mt. Gox scandal took place and government in China released strict regulations to stop people from trading in cryptocurrency. So he had to close that exchange and came up with the idea of a decentralized cryptocurrency exchange.
Then we have our COO, Johnston Chen, he and Daniel were also used to be high school mates and shared the same dorm. Johnston was used to work for a big Chinese e-commerce company and managed all operations in Southern China.
- So how you got involved in blockchain and Loopring to be more specific?
Jay: Well i know about bitcoin ever since and learned about mining in 2012 while i was still working at Paypal. One of my friend started mining bitcoin and made quiet a fortune in a very short time, that’s how i started taking interest in blockchain. I met Daniel at a blockchain lab in Shanghai and we share our ideas and after sometime decided to take on Loopring. We wanted to create a very transparent and safer trading experience for the cryptocurrency community.
- Does Loopring has any advisors?
Jay: Actually we have a few but we only listed 3 on our website. Prominent amongst them is Hongfei, founder of Neo and Ontology, i guess everyone knows him. Among our advisers are also some of China’s leading university professors as well and that really add value to Loopring.
- Please tell us how Loopring actually works.
Jay: Sure! So Loopring is a decentralized exchange solution. It’s an API that enable people to build up a decentralized exchange on top of its wallet. We are agnostic protocol that means our protocol can be integrated with any blockchain. But right now we’ve only deployed our protocol on Ethereum blockchain because we believe Ethereum has the largest ecosystem.
I also use the wallet of one of the biggest cryptocurrency exchange Binance. As we’ve seen in the past, what if there’s a cyber attack on the exchange and my account is compromised? Where would i go to and report if Binance don’t take any action as currently there is no government or regulatory body that’ll protect me? So there’s a big issue with the centralized exchanges.
- Talking about regulating cryptocurrency, do you see a crypto regulating body will be in effect in the near future?
Jay: Yeah it’s coming already! Our team was in Hong Kong for the Hong Kong Fintech week as we talked to the local government and PWC. On November 1st 2018, the Hong Kong government has introduced Sandbox, that’ll apply regulations to crypto investors just as Singapore.
- East Asia is considered a hub for blockchain technology and cryptocurrency to be more specific. How do you see things will shape?
Jay: Yeah that’s true as Singapore already has the Sandbox and I’m heading to Taiwan in the middle of November 2018 to talk to the Taiwanese government as they’re also organizing a conference to regulate cryptocurrency and introduce sandbox. We all know how cryptocurrency has a potential to boast economies and governments are not going to miss out on it. What if a government say that they can regulate a security token offering then a lot of money will be attracted to the crypto space through security token.
- Correct. Well coming back to Loopring, what makes Loopring stand out from the rest in the blockchain world?
Jay: First we are very confident about our technology, the way how our team is so technical oriented, keeping in mind how blockchain is pure tech to its core. I would say 90% people in our team are developers so technology is without a doubt our strength. Since we have good number of long term investors who don’t rush to short term results like the token price and stuff, Loopring is here to stay. It’s a little bit confidential but I’d tell you that we are the first blockchain project that governments are contacting. We have a high chance to join the Sandbox and we are also advisory to SFC ( Securities & Futures Commission of Hong Kong).
We also have a very big community specially in Asia as we are pretty dominant for the DEX protocol and we are in the top 2 DEX protocol in the world.
- You told us how tech oriented Loopring team is, how big Loopring team is currently?
Jay: We have around 20 people, i said ‘around’ because we take interns as well. The team is distributed but our head office is in Shanghai. We have engineers in San Francisco, Belgium and some of our team is in Canada and New York. They all are full-time Loopring employees. Since Loopring has a really strong community we also have contributors in Japan, Korea, Australia and Europe. It’s hard to tell how many contributors Loopring has currently, as they are contributing for quiet a while and the number is growing.
- As you said governments are contacting Loopring, what are the challenges Loopring is facing currently?
Jay: I think the technology itself is very challenging because blockchain is a fairly new concept and still in the early stage. It’s just last year that bitcoin price touched an all time high, resulting in more people investing in bitcoin and blockchain industry in general.
There’s no decentralized application came out as of yet that convinced the masses. Ethereum or any other public blockchain has scalability issues. For example one of the challenges we have been facing is the infrastructure capability is because of Ethereum TPS. Our smart contracts occur on the chain but all the orders broadcast off the chain. But once the orders match, we put the orders on the blockchain and only then the Ethereum TPS comes in to effect. Imagine if the Ethereum network gets clogged then it’ll take about 15-20 minutes to verify the transaction and the user experience will be really bad.
Centralized exchanges can match the order straight away but DEX’s rely on blockchain TPS speed and that’s the real challenge. To this problem we have already figured out the solution that Loopring will roll out soon.
- Speaking specifically on technology, what’s the development problem Loopring is facing right now?
Jay: Right now the challenge our development team is facing is the relay. We did a training competition back in August 2018 that turned out to be a huge success. That training competition contributed to almost 3% of Ethereum’s total transaction volume,. The result was great but we also plan to solve a lot of problems on our relay and now we are working on our relay 2.0 because 1.0 is not much user friendly. Daniel is working on the feedback we got that’ll be catered in the next version which will be released at the end of this year or the beginning of 2019.
- Public blockchains are facing a lot of scalability issues, in your opinion how can we solve this problem?
Jay: Even though we’re not a public blockchain but scalability does affect us, to which we now have the solution. We have been working on it but right now i’ll not disclose too much about it but I’ll be comfortable to talk about it at the very end of this year.
- So what can we expect from Loopring in the near future?
Jay: All our efforts are focused on 2.0 release currently. Daniel had a meeting with the Hong Kong government right before China lifted Bitcoin ban and Loopring foundation will be collaborating with PWC to promote cryptocurrency ecosystem. So a lot will be coming out from us.