From March 16th to March 31st, to further test the usability and performance of Loopring Exchange, we held a two-week trading competition and issued LRC rewards. The trading competition has been completed and we’d like to share some data with the community.
The total number of trades was 538,327, or an average of 33,645 trades per day. The maximum number of trades reached in a single day exceeded 80,000.
The total volume was $7,866,735 or an average of $491,670 per day. The highest volume reached in a single day exceeded $1.93 million.
We were super impressed with the figures. Not only did it showcase what a zkRollup DEX can handle, but it also put our backend to the test. We thank the community for their high level of participation, support, and feedback.
As the dangers of centralized exchanges become more prominent, and as DEX tech and liquidity continue to make incredible progress, traders and volume are beginning to shift. While this is already being realized today, the best is yet to come.
Overall DEX trading volumes have grown steadily throughout 2020. In March, DEX trading volume reached a high of $450 million in one week. As you see in the chart below, these numbers represent the highest figures yet, owed primarily to the significant ETH price volatility during the month. On dYdX and Uniswap, average daily trading volume in second half of March was approximately $7.6 million and $3.9 million, respectively. In ‘normal’ times, (e.g. January), volumes on dYdX and Uniswap averaged roughly $2 million daily.
The average daily trading volume on Loopring Exchange during the trading competition was close to $500,000, and the highest transaction volume in a single day was close to $2 million.
Looking at the number of transactions, Uniswap performed a total of 250,000 trades in March, an average of 8,333 transactions per day, the highest of all DEXs (excluding Loopring). Looking again at ‘normal’ times, Uniswap performs approximately 4,000 trades per day.
The average number of trades on the Loopring Exchange during the two week trading competition was almost 34,000 per day, or 8 times that of Uniswap. The highest trade count in a single day was above 80,000 trades.
At 34,000 trades per day — or in the weekly terms DEXs depict above, 238,000 trades per week — the most notable takeaway is that Loopring Exchange can support extremely high throughput.
Of course, this is the most prominent property of any DEX built atop the Loopring zkRollup protocol. In fact, at full throttle (requiring maximum demand), Loopring protocol can settle 174,960,000 trades per day.
The corollary of the extremely high throughput is that this throughput can consist of smaller-sized trades, given the cost efficiency of our batched settlement, which we explore next.
Loopring Cost Data
The current on-chain cost of each trade is about $0.003, or about 5,000 gas. This is one-tenth to one-fiftieth the cost of other DEXes.
And just like the throughput is far from reaching its maximum potential, the on-chain cost can also go down much lower, to $0.000082 per trade.
On-chain costs are composed of
- Block commitment + the transaction data cost for the on-chain Data Availability (DA) and;
- Zero-Knowledge Proof (ZKP) verification.
Currently, the cost of the ZKP verification is 60% of the total on-chain cost and the cost of the block commitment + DA is 40% of the total on-chain cost. This ratio will flip in the future, with the ZKP verification portion becoming the smaller side, due to the support of larger block sizes, as mentioned here.
Loopring relayer currently supports blocks of maximum size 128 (meaning 128 requests in a batch). We have continuously optimized the relayer’s batch processing, and at present, the percentage of larger blocks is gradually increasing to be mostly of size 128. We try to avoid generating small blocks to lower the average on-chain cost. The figure below shows the distribution of the number of blocks of different sizes in the trading competition.
The Loopring protocol can actually already support larger blocks of size 256, 512, and 1024 to lower the on-chain costs (and eventually 4096), further reducing transaction costs. The Loopring relayer will support these when demand reaches the levels where they can fill those batch sizes in a reasonable amount of time.
We want to use this cost advantage to bring greater benefits to users, and pass on the settlement efficiency in the form of lower fees to traders. Thus, before the competition, we lowered our trading fees to what we believe is the absolute most competitive levels in the DEX space, and in CEX space as well. Maker fees on Loopring Exchange remain 0%, and taker fees were lowered to between 0.06% and 0.1%. For context, Uniswap charges 0.3%, and dYdX charges between 0.15% to 0.5%, and several CEXs charge up to 0.5% or beyond. Thus, even our 0.1% taker default fee is the lowest vs other venues, and the 0.06% taker fee is really rock bottom.
LRC Rewards Distribution
We have completed counting the winners of this trading competition. Traders were rewarded based on trade count, and on volume (rules here). Congratulations to all winners, and to the user with account ID 82, who won 90,000 LRC rewards, ranking first! LRC rewards will be issued next week. Thanks again to all participants.
We have a big few weeks ahead:
We are in the process of fully supporting the WalletConnect protocol. When this feature is available, users can log in and use the Loopring Exchange by scanning a QR code with their mobile wallet, meaning it will no longer be limited to Metamask.
We are also perfecting the relayer’s API documentation. We plan to release Chinese and English API technical documents in mid-April and introduce reward programs for market-making and referrals.
Loopring is a protocol for building high-performance, non-custodial, orderbook exchanges on Ethereum using zkRollup. You can sign up for our Monthly Update, learn more at Loopring.org, or check out a live exchange at Loopring.io.