To start, I’ll give you a small clip of a recent podcast with Vitalik (creator of Ethereum) talking about Zkrollups and how he thinks Loopring is the solution for Ethereum problems of scaling and gas fees (fees from using etherium).
I recommend this bit from 1hr:14:00 to 1hr:17:40 to understand Loopring and ZkRollups from his words.
The whole Rollups section is very interesting.
The whole video is also very nice for apes with more patience 🙂
Let me explain in a simple version about the future of markets, financial and GME.
People are often seeing crypto as a casino to go in there and bet to make money, not actually basing themselves on the project fundamentals.
Fundamentals in a project is what makes the project (their approach to solve a need), the service/product they are providing, how is gonna perform towards the future and how is providing the solution for that need.
Right now everyone has a need for a different economic industry due to the current sector being corrupt and manipulated based mostly in politics and whatever the fed, HF, whales and central banks do with it.
That completely disconnect the sector from the fundamentals and performance of the projects/companies.
So there is an urgent need to move to decentralized and bring back more democracy and global consensus instead of the 0.00001% controlling everything.
Cryptos L1 (like Bitcoin or Ethereum or basically all cryptos) have 2 big problems.
1: transaction speed (Bitcoin can do 7 transactions per second, Etherium 30 per second), compared to MasterCard that does 5000 per second, can’t be a viable option to use for a lot of people or a lot of transactions, will create a massive queue of transactions that also bring to number 2.
2 transaction fees (gas fees) are priced based on supply and demand, transaction queues will leave to have a constant high demand but low supply of transactions, making them too expensive and a lot of the time even more expensive than the digital/real asset you with to purchase.
Loopring created a winzip like tool by creating a off chain copy of a blockchain with massive scale ability (up to 400k transactions per second), then bundle all the transactions that happen on that L2 blockchain and send it to Etherium in massive batches, splitting the cost to all the transactions, make in it super cheap.
Transactions in L2 are super fast since is in a off chain blockchain while zkrollups allow to be that bridge to get the L2 constantly verified and validated by the entire L1 of ethereum everytime those batches occur.
This is the future of currency, financial and NFTs. Basically what financial can do, this can do it much better, while keeping the transparency and high security of a blockchain consensus based of ethereum, also while maintaining democracy and avoiding creating bubbles or synthetic shares.
Keep in mind that there is something so beautiful on those projects and marketplaces, the sector place doesn’t work for one institution or person (like a economic organization and CEOs), they work for the system itself.
Let’s say you are a singer or have a band and your band releases your album but instead of selling it using dollars (fiat), decided to sell it using their tokens in L2. They split that song in 1million pieces, first songs are sold for $1 worth of the token at the start.
Out of that $1 80% will go back to the entire network of owners of that band/album tokens, 70% of those are spread across everyone and 10% is burnt to keep reducing the supply increasing the net worth. The last 20% will go to the creator/artist, always, always that ratio.
So if you are part owner of any piece of that song/album, everytime someone comes in or transaction that specific song, EVERYONE WILL BENEFIT from it.
That is decentralized financial. That’s based on fundamentals, and that true value of capital, you believe in the band/artist, and the more sales and transaction and more popular becomes, more value will bring back to the entire network.
This is where GME comes in.
Not only bringing top expertise on blockchain and NFTs, but seen ahead to the future (I based this on Ryan Cohen long friendship with finestone).
GME is gonna be the first massive project of this, already been tested and working on Loopring L2 (you can check yourself).
The possibilities are endless, but let’s keep it simple with one example.
Let’s say that there is a new Mario Bros battle royale, they decided to create 10 million copies of it and release them as an NFT.
$10 worth of GME coins in the GME L2 marketplace.
With those $10 you can play the game, but also you own part of the project, you can decide and participate in new updates and items released so give you more power towards the game.
But also, if the game succeeds, the tokens you have by selling the game (if you decide to do so) will be more valuable against those initial ($10), because now the game sector cap is gonna be bigger and we know decentralized sector spread the spoils of sales to everyone that has that coin.
Also, limiting the amount of copies will create that when all the copies at base rates are sold, a auction sector for the copies will be the only way to purchase that game and getting into the project, then when there is higher demand and little supply, boom! The price of the copies are gonna increase.
The NFT can store data, so in your copy of the game you can have the items you unlocked or purchased in game or save files, making your game unique and more/less valuable.
Also, if this copy was owned originally by Ryan Cohen or any person that is famous, you can see it and confirm it on the blockchain and that will also will give added value to those transactions in the sector place, making those copies more valuable.
For every of those transaction no matter the prices are trade on, benefits THE ENTIRE NETWORK OF FANS and owners of the game.
Also keep in mind that this system is lot more intelligent than any other economic exchange, these transactions are smart contracts, meaning that you can set specific rules for the transactions.
For example, I can limit a copy of the game to be sold only 5 times and if sold a 6th time will self destruct, or can be only trades once every 5 days, or that the increases on price can only go up by 5 tokens at the time (controlling volatility) and so on, the list goes on with unlimited possibilities.
TLDR: This is the future, and true financial democracy. GME is set to be the pioneers of this new technology that Vitalik himself (Ethereum creator) sees as the future.
Above you will find a very easy to understand explanation of what is happening, why and how is happening with real examples.
Please share for people that don’t understand what blockchain is and educate a bit about the future of possibilities.
This is what I think they meant by
POWER TO THE CREATORS
POWER TO THE PLAYERS
POWER TO THE COLLECTORS
If any of you guys have any questions, I’ll be more than happy to answer. 🙂
🍉 is out.
Edit: Changed a mistake, ethereum is 30 transactions per second as opposed to 13 transactions per second.
Edit 2: someone made a very good question so I this is the reply to clarify doubts.
Question is : All you talk about is scarcity and value increase. Why would that be desirable and sustainable?
My answer :
The point is not about the actual increase or decrease of your value, in reality this is a replacement of banks.
Let’s say you have $100 in your economic organization account sitting in there, that money goes to the sector cap of the economic organization as an organization since they can “use” that money for themselves and you trust them with the keeping it, they don’t keep it.
With inflation today (6.2%) your money by sitting still “in the economic organization” is actually losing value at that rate.
That’s why the more money you have the most likely is for you to invest it in things that at the very least give you that 6.2% of your losing value back. Usually invested in government fixed-income securities which suppose to be “safe” and “low hazard” since they are backed by the government and the government haven’t default ever yet. So you put your trust that at the end they will give you your money back plus your yield (6.2% or more).
So even tho you have your $100 in your account, anything else around is going up at an inflation rate (6.2%), and suddenly your buying power is less, less things you can buy with the same $100 dollars.
The economic organization used your $100 And let’s say they doubles that money (the on average get lot more than double), but doesn’t give you back anything really, probably a very tiny % of returns for you storing your money in the economic organization, a lot of the time they charge you fees and actually take even more money and value from you.
This is the current system, helps the banks and big institutions with your money. Increasing the value of everything else also by printing counterfeit “legal” money at the FED and they call it QUANTITIVE EASING.
So there is a reason and need for a currency to grow in value to keep up with everything growing in value around it.
The token L1 will need a counter party currency to be exchanged (most common is US Dollar that use the fiat system). Blockchains have limited supply of token (a set amount of tokens), and the more currency injected to it (US dollars for example), the more sector cap of that blockchain of tokens (ethereum cap is currently 250 billion) and the number of tokens supplied for ethereum is 117.7 million tokens/pieces. You divide those numbers and should give you the price per piece.
The more people get into buying ethereum for example the bigger the sector cap so bigger the price discovery.
Edited: better example 🙂
Let’s imagine this situation.
In the current world we have:
The singer will go to a label to promote his album, manager, Spotify, YouTube, etc, and they usually take the larger amount of the deals.
Now let me explain better how the model would work with NFTs DAOs.
A singer make one song and sell it to me in let’s say $1 and put in the contract that each time that song is resold the singer gets 80% of the profit and 20% goes to the seller.
So I sold the song to somebody else, then in this case the singer get $1 from my original sell plus $.80 from my sell. I get 20% of it. everytime the song is resold, 80% goes to the artist and 20% goes to the seller in the network. No middle man like Spotify or Apple Music and the artist always gets its part and 20% for the seller. You can do it on and on and on with always 80-20. You had the song, listened to it and when you sell that. The owner will be the singer but everyone can listen to the song which is the product, like games.
There are other models in which you can do 70% to the singer, 20% for the reseller and burn 10% of the albums with that extra 10% of money to reduce the amount of supply of copies and making it more exclusive. Increasing the amount of sales 🙂
You can make it 50-50, 40-50-10, it’s up to the project and the project goals. No one is forced to buy anyway and if the project is too greedy or doesn’t benefit everyone so you are free not to join.
I think this explains it better so I’m gonna add it to the post 🙂
This are smart contracts and you can customize it according to what you need. Don’t forget that.
In comparison to the financial system we currently have, you put money in the economic organization and they use it for their sector cap to make more money for themselves, giving you crumbs and you never owned a piece of the economic organization, but you did “invest in them” by putting your money in for them to play with.
With blockchain you put your money in, you actually own a part of the project and the project success is shared with everyone equally and proportionally of your stake of course. So makes it easier to beat inflation and not letting others benefit from using your money to trade.
Edit 3: there was another question to help apes clarify this. Why Loopring? What LRC has to do with all this?
This is my answer:
They are the ones and first that created a Zkrollup, that is a key component on how the interaction between L1 and L2 works, it’s the tool that compresses the off chain interactions from L2.
Like Vitalik explained in the video, takes only the validation part of the NFT taking just a minimal part of data to verify in the L1 of ethereum which is the most secured one and will be even more secure the bigger it gets with the coming of eth 2.0 and sharding (multiplying eth 1.0 multiple times and connecting all in the network making huge scaling).
Then they take all the minimal parts together (of each transaction in L2 off chain) and compressed them into lot less, making the cost of each transaction also be reduced by that amount of compression.
That’s how you can make a L2 transaction of NFTs (of everything that has value in them and are validated of ownership in the ethereum blockchain ledger) cost cents, I’ve seen the current Loopring L2 in developments and tested constantly cost cents, I haven’t seen a transaction of a dollar yet and I’ve been monitoring it, and big movements transactions to Ethereum and fiat (US dollars).
Hope that clears your mind and expand it 😉
Hope this helps.
Edit 4: thank you for all the awards apes, let’s share this out and get everyone educated about the future, it’s gonna be amazing! Apes are gonna be first too!!!!
Buy, Hold, DRS and learn is what I do. 🙂
I like to keep it simple stupid – DFV a value investor based on fundamentals.
Source for the 30TPS for Ethereum, some other courses claim 13TPS, still pretty low for the needed demand in eth 1.0