Announcing LUX to Ethereum ERC-20 Token Bridge
Luxcore is developing a new way to trade LUX! We are very excited to reveal WLUX (Wrapped LUX)! WLUX will be an ERC-20 token that will be traded on decentralized ERC-20 token exchanges (like uniswap.org and matcha.xyz). This new token will bring accessibility and liquidity to existing LUX investors, and open the coin up to a much wider pool of potential investors who may not have utilized existing exchanges where LUX is listed.
What is a wrapped token?
Wrapped tokens represent the value of another asset that exists outside of the Ethereum blockchain but allows investors to hold that value on the ETH chain. This empowers investors who use ETH-token exchanges to trade for LUX (or a LUX equivalent).
What about Luxgate? How is this different?
There are some great decentralized exchanges for ERC-20 tokens, but these only work for tokens on the same blockchain (and representative tokens like WLUX). Luxgate will connect blockchains and allow investors to trade coins of different chains peer-to-peer without a third party. This will provide much needed liquidity and accessibility for hundreds of crypto projects who struggle with getting listed on quality exchanges. And while a wrapped token is a nice workaround in the meantime, it is subject to the speed and fees of the Ethereum blockchain. It is, however, a great way for investors to trade LUX today in a totally decentralized way (by either wrapping LUX to sell tokens, or buying tokens and unwrapping LUX).
Where do I get Wrapped LUX tokens?
Wrapped LUX tokens will exist thanks to a LUX ERC-20 Token Bridge which allows WLUX tokens to be created or traded in for LUX coins. We are currently developing this token bridge and will have detailed information about how to wrap and unwrap coins when it is officially launched. Wrapped tokens will be traded on a number of token exchanges. Some of these exchanges allow users to add tokens themselves, and others may add WLUX in the future — so stay tuned for those announcements!
Liquidity Provider Program (Possibility)
We are looking into possibly creating a liquidity program to support WLUX. This program would incentivize users to provide liquidity for WLUX tokens. Users who provide liquidity by way of a liquidity pool might earn WLUX tokens as a reward. This would support trading of the token and ensure buyers and sellers would be able to trade WLUX any time. Luxcore is currently looking into this possibility and will make a final determination based on our research, and as we watch the trading to see if a need exists.
Can I stake my Wrapped LUX, or run a masternode?
The WLUX token exists only on the Ethereum blockchain, so you are not able to stake your tokens and earn LUX coins, nor can you use them as collateral for a masternode. Tokens would need to be unwrapped for LUX coins if you wish to stake or start a masternode. Tokens are great for easy exchange and storage, speculating on the value of LUX, or hedging your positions for specific situations. Investors may also choose to take advantage of arbitrage opportunities to trade tokens or LUX coins against each other as they should have the same value. There is also the possibility Luxcore will add an incentive program where users could earn WLUX tokens for providing liquidity (see above).
Why is LUX not an ERC-20 token?
LUX operates on its own blockchain and has the capability to run its own tokens. If LUX were merely a token on another cryptocurrency chain, LUX would be subject to the speed and fees associated with that chain. LUX is building an ecosystem which will empower users and crypto projects with a variety of tools (Luxgate, Luxedge, etc.). We have big plans for our project and having our own blockchain with fast, low fee blocks will help us achieve much more than we could as a token on another chain.
We hope you are excited for the new WLUX token! One day you will be able to simply download Luxgate and trade LUX with many other coins right in the wallet in a fully decentralized process. In the meantime, these WLUX tokens will add liquidity and accessibility that many users have asked for.
Thank you for your support of our project and stay tuned for much more from us!
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