Matic, xDAI (STAKE) and Loopring (LRC) rally as Ethereum gas fees rise

The start of a new month has rebounded the cryptocurrency market as Bitcoin (BTC) price rose steadily from a low of $ 43,537 on Feb.28 to a high of $ 49,200 during today’s early trading hours.

While traders enjoy positive market movements and try to get back into positions, the increased use of DeFi will continue to increase fees on the Ethereum (ETH) network and the spotlight on top layer 2 (L2) protocols will provide working solutions .

Three protocols that have turned out to be top L2 competitors with working platforms are Polygon (MATIC), xDai (STAKE), and Loopring (LRC). Each offers its own Layer 2 approaches to reduce the heavy traffic on the Ethereum network.

MATIC / USDT

Polygon, formerly known as Matic, was officially launched on February 9th as a layer two aggregator for Ethereum to offer an interoperability protocol for the network.

Since the craze for the rebrand began, MATIC price has risen 400% from $ 0.05 to an all-time high of $ 0.245 on March 1st. The growing excitement for the launch of the Aavegotchi (GHST) network network on March 2nd has also boosted attention and trade volume on MATIC.

MATIC / USDT 4-hour chart. Source: TradingView

Aavegotchi was one of the first projects to bridge the gap with the polygon network, and more projects are likely to be added if the main network starts smoothly.

MATIC also got a boost on February 26th when it was announced that gaming giant Atari will be integrating Polygon to “bring its NFT and token products to Layer 2,” along with the launch of the “first EOS Polygon.” -Cross-chain “bridge” carried out in collaboration with pNetwork (PNT).

XDAI / USDT

xDai is another Layer 2 solution that has caught investor attention in the past few weeks. The xDai (STAKE) chain is a stable payment block chain created by the POA network, an open source public side chain of Ethereum that provides a framework for smart contracts.

STAKE is designed as a multi-chain marker that validators and delegators offer as security in order to participate in the consensus mechanism and to receive incentives for staking blocks. The aim of the xDai platform is to offer fast and inexpensive transactions in the Ethereum network.

Since trading at a low of $ 7.50 on Jan. 2, STAKE price rose 500% on Feb.21 to a new all-time high of $ 43 before coming under pressure alongside the broader cryptocurrency market.

XDAI / USDT 4 hour chart. Source: TradingView

A scroll through the project’s Twitter feed reveals several recent partnerships and integration announcements that have helped boost STAKE over the past few weeks.

Notable mentions include an integration with the Binance Smart Chain (BSC) that allows users to move money from Binance to xDAI using a BSC-to-xDai bridge, as well as the announced migration of the up-and-coming Bao Finance (BAO) to the xDai -Network.

LRC / USDT

Loopring is a Layer 2 solution that specifically focuses on creating decentralized cryptocurrency exchanges (DEX).

One of the main causes of congestion in the Ethereum network is the steadily growing activity of popular DEXs such as Uniswap (UNI) and SushiSwap (SUSHI). Having a separate side chain specifically designed for exchange trading could help reduce congestion on the network, and this is the goal of Loopring.

The overall goal of the Loopring Protocol is to combine the benefits of decentralized exchanges with the liquidity and order book management of the central exchanges to increase order execution efficiency and improve the liquidity of the DEX ecosystem.

Since Jan 2, the LRC is up 430% from $ 0.165 to a high of $ 0.88 on Feb 12.

LRC / USDT 4 hour chart. Source: TradingView

After falling to a low of $ 0.46 on February 28, LRC price rose 30% after it was revealed that the Loopring exchange added multiple WBTC / stablecoin pairs and “6 new opportunities to trade.” with WBTC on Ethereum L2 “bot.

Cointelegraph Markets Pro’s VORTECS ™ data identified an optimistic outlook for LRC on February 28 ahead of the recent price hike.

The VORTECS ™ Score, exclusive to Cointelegraph, is an algorithmic comparison of historical and current market conditions derived from a combination of data points such as market sentiment, trading volume, recent price movements and Twitter activity.

VORTECS ™ Score (green) vs. LRC price. Source: Cointelegraph Markets Pro

As can be seen in the graph above, the VORTECS ™ value for LRC peaked at 73 on February 28th, just as the price started rising 30% to $ 0.59.

The ongoing price hikes for Ethereum, which was back above $ 1,500 on March 1, will only add to the pain of traders trying to use popular DeFi protocols on the network.

The amount of gas needed to perform basic transactions, as well as the price of these charges, will continue to drive users to test the alternatives that Layer 2 solutions offer. Polygon, xDai, and Loopring are three protocols that are well positioned to capitalize on this trend.

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