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With Ethereum constantly facing congestion and scalability issues the cryptocurrency space is seeing more and more layer 2 solutions appear with the most popular being Polygon (MATIC), however, is Polygon the most efficient at helping Ethereum scale or is there another layer 2 blockchain that could take the number 1 spot? In this article, we find out with a comparison of Loopring vs Polygon.

One question that often comes up is Loopring vs Polygon. While both are technically called layer 2s and they both work alongside Ethereum both projects are very different and offer users a different product. Polygon is a layer 2 blockchain built to deploy dApps and smart contracts while Loopring focuses on utilizing Ethereum and the layer 2 technology to offer users a DEX where they can trade and make transactions essentially through Ethereum but at a fraction of the cost.

Loopring vs Polygon

What is Loopring (LRC)?

Loopring Logo

Loopring is a layer 2 decentralized exchange tool built on top of the popular cryptocurrency Ethereum. Loopring offers low transaction fees, high throughput, and a high level of security through its zkRollup technology. Utilizing zkRollup technology Loopring can aggregate and execute transactions off-chain allowing the network to handle over 2,000 trades per second while maintaining a low cost per transaction.

Loopring is a layer 2 protocol meaning it is not its own blockchain rather you should look at it as an app or a piece of software, built to offer users a place to trade assets and make payments on Ethereum but at an affordable cost and faster speed. Loopring also offers the ability for exchanges to build on top of it allowing the exchanges to in a sense “bypass” the high transaction costs and low speeds of Ethereum while maintaining Ethereums security.

This is done using the zkRollup technology we spoke about earlier which allows exchanges to settle users’ trades near instantly rather than relying on the Ethereum network to have to do so. Batching transactions and completing them elsewhere before returning them to the Ethereum network this minimizes the number of transactions that have to be completed on the Ethereum layer 1 hence minimizing the costs to the end user.

What is Polygon (MATIC)?

Polygon Logo

Polygon is a layer 2 blockchain built to help Ethereum solve the congestion and scalability issues that it has since started to experience. Designed for its speed, scalability, and security which it inherits from Ethereum Polygon quickly grew a vast ecosystem and large user base making it the biggest and most popular layer 2 blockchain on the market.

Making use of a proof-of-stake consensus mechanism unlike Ethereum proof-of-work mechanism Polygon is able to process transactions a lot faster and cheaper by using validators made up of staked MATIC, the native cryptocurrency of the Polygon network.

Polygon offers upwards of 65,000 transactions per second which is compared to Ethereums 30 transactions per second this is a huge upgrade, made possible by utilizing validators to batch and process the transactions rather than have miners compete for the transaction similar to how Ethereum was running prior to the Ethereum 2.0 upgrade.

Match that fast transaction speeds with the low transaction costs of just $0.004 per transaction you can see why Polygon became so popular and grew such a thriving ecosystem so fast.

Polygon Gas Prices

 

What Is The Difference?

While Polygon and Loopring are both technically called layer 2s so some may assume they are both similar blockchains they are both very different platforms. Loopring is a decentralized exchange focusing on AMMs on Ethereum and Polygon is a general-purpose layer 2 blockchain designed to host dApps and deploy smart contracts.

As far as a technical side of things it is hard to put these two up against each other as they both serve different purposes, while both offer cheap transaction costs and fast transaction speeds it is in different ways. Polygon can be used as a general-purpose payment network to send and receive payments at a low cost while also participating in dApps and smart contracts. While Loopring can be used to trade financial assets and instruments with very minimal trading fees.

So it really does just boil down to the needs that you have and what kind of solution you are currently looking for? Looking for somewhere to trade Ethereum assets at a minimal cost and much faster than Ethereum? Then Loopring may potentially be what you are looking for.

However, if you are looking for a complete blockchain and the ecosystem that goes alongside it then Polygon is the winner here, with a deep NFT and DeFi ecosystem Polygon offers users a complete blockchain with the security of Ethereum while offering cheap fees and fast transactions.

Conclusion: Loopring vs Polygon?

While both platforms are very different I would personally choose Polygon as the winner in this face-off due to its high level of adoption and the wider use cases it has over Loopring. This isn’t to discredit Loopring as the project performs very well in its own respective sector and with its zkRollup technology it definitely has a future as they keep working and developing the project.

The big selling point for Polygon is its vast ecosystem matched with the technical aspects of low transaction costs and high transaction speeds, and with so many decentralized exchanges now supporting and operating on the Polygon network there are dozens of places you can trade Ethereum and Polygon based assets while bypassing the congestion of Ethereum.

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