The Loopring team has announced the liquidation of its decentralized exchange and automated market maker. We break down the reasoning behind the decision.
The move effectively marks the end of the Loopring project, which raised $45M in its 2017 ICO and pioneered Ethereum (ETH) scaling through zkRollup technology. Developers cited three reasons:
- Lack of mainstream adoption
- Insufficient business expertise
- Technological lag behind modern zkEVM solutions
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All user funds will be returned directly, with no gas fees charged to users.
What’s Known About Loopring on Ethereum
Loopring launched in August 2017 as the first zkRollup protocol on Ethereum. In December 2020, the project unveiled a DEX with an order book and automated market maker, featuring ring-sharing and order matching across multiple platforms.
However, the team admits the protocol “never gained meaningful adoption.” It lacked a virtual machine, smart contract compatibility, and real-world payment use cases–all of which held back ecosystem growth. Modern zkEVM solutions like zkSync, Scroll, and StarkNet have since overtaken Loopring in functionality and adoption.
External factors added pressure. In June 2024, the project was hacked for about $5M and never fully recovered. In March 2026, Binance delisted LRC, further undermining liquidity and confidence. Earlier, in 2025, the wallet and DeFi products were shut down, and CEO Steve Guo stepped down in August 2025.
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How Fund Returns Will Work
The Loopring team has promised to return all user funds directly to Ethereum crypto wallets. A full list of final Layer 2 balances, including spot positions and AMM, will be published. A two-week review period will follow. The team will then update the DEX smart contract to allow withdrawals only from authorized addresses and send assets in batches. Users with balances over $10 will receive funds. The project will cover all gas fees.
The announcement drew mixed reactions. Some users expressed regret, while others called the project a scam.
Loopring’s closure marks the end of an era for the first zkRollup–a project that, despite its technological breakthroughs, couldn’t compete with more flexible and compatible solutions.
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