Nowadays we all watch a lot of online videos or even use live streams. Broadcasting or streaming live videos is quite expensive. Unbeknownst to you, centralized transcoding and distribution companies are paid quite a lot of money to broadcast. Of all the bandwidth of the internet today, 80% is used for video streaming. So if you stream a lot, it becomes an expensive affair, and that is exactly what Livepeer has a solution for.
In this blog we are going to talk about Livepeer and the associated LPT token. I’m going to explain what Livepeer is exactly and how it works. We are also going to investigate the team behind this project and take a look at the course. If you want to know where to buy LPT, you’ve come to the right place.
Please note: please note that the text below about ‘Live Peer (LPT)’ as well as the explanation to this should in no way be construed as advice. The choice for whether and in what way you want to trade (crypto) and which choices you make in terms of investment is up to you and you alone. We are not financial advisors.
Here you can first watch a video showing how Livepeer works.
- 1 What is Live Peer?
- 2 How does Live Peer work?
- 3 To discontinue the LPT token, why?
- 4 Who is behind the Livepeer project?
- 5 What is the LPT token?
- 6 What is the price of the LPT token?
- 7 Where can you buy the LPT token?
- 8 How can you keep the LPT tokens safe?
- 9 Conclusion
What is Live Peer?
Livepeer is a decentralized open video infrastructure where developers can build video streaming apps. It was built on the Ethereum network in May 2018 . They want to control the fast-growing, centralized and expensive live streaming industry. That is precisely why Livepeer is managed by a decentralized network of node operators who stake the LPT token. Both the traditional way and web3 video streaming are made possible with significantly discounted prices compared to other cloud providers.
Another big advantage of Livepeer is that the scalability is very high. Their objective is to increase the reliability of video streaming . At the same time, they want to reduce the additional costs of this by up to 50x . To do this, Livepeer is building a P2P (Pay-to-Play) infrastructure that will interact with a marketplace on the Ethereum blockchain. Their infrastructure also has no limit for the number of connections.
In itself, this technology already exists to a certain extent. What makes Livepeer unique is that they are the first to make this technology available to the entire internet, and not just to one company. No one has tried to do this with nodes run by the users.
Who is Livepeer made for?
What is important to understand is that Livepeer does not take care of the broadcasts itself, but it pulls the strings behind the scenes. Here you can see who Livepeer is designed for.
- Developers – if they want to build their live and on-demand applications, Livepeer can power their functionality.
- Users – For your video streaming, gaming, coding, entertainment, educational courses and other content, you can use applications built on Livepeer.
- Broadcasters or broadcasters – if you have a large audience and incur significant streaming and/or infrastructure costs as a result, Livepeer can help with streaming costs and infrastructure overhead.
Applications for Livepeer include as follows;
- Pay-as-you-go – for selected live events, such as concerts, sports matches, courses, or see an artist live on their own channel. For all these options, a transaction of value is programmed into the code (baked). Broadcasters are only paid for what the viewer wants to see live. This without credit card, account, or identity control, as with a centralized platform.
- Uncensored live journalism – platforms such as Twitter or Facebook , naturally reach a large audience. However, the videos are also quickly blocked, especially when it comes to political conflicts, for example. Livepeer does not have that, and can live messages directly, without censorship of every source of fire.
- Video Enabled DApps – Livepeer can add a decentralized application to the stack, which can provide a fully scalable live video stream to any number of viewers.
How does Live Peer work?
Livepeer works with ‘ orchestrators ‘ and ‘ delegators ‘. Then you still don’t know much, so it’s good to explain this with examples.
Later, though, let’s take a look at why videos are so expensive to stream. The reason for this is that if you want to put a video on the internet you have to transcode it first. This is the process of formatting a raw video file so it doesn’t matter what bandwidth is available, 2G or 5G, or what device you are using. With these variables in mind, you still get the best viewing experience.
Who are the orchestrators?
The ‘orchestrators’ are the users that Livepeer relies on. They add their computers to the network so they can handle the app developers’ transcoding and distribution requirements. They do this by making available their computing resources, such as the CPU, GPU and bandwidth. Only the sun rises for nothing, and in return they get paid crypto. This is done in the form of, for example, ETH or stablecoins DAI . As an orchestrator or node operator, you can also get more work if you build a good reputation.
The image below shows how the process works. In the middle, where all the dots and lines are, that’s where the orchestrators sit and perform their task. Transcoding and distributing videos.
To become an orchestrator, you need a decent dose of technical knowledge and can easily become a full day job. However, if you want to become an orchestrator, you must first earn or purchase the Livepeer or LPT token. Later I will come back in detail to what the LPT token is exactly. The intent of this token is to coordinate, start up and incentivize participants. In this way, Livepeer gets in return a network that is cheap, effective, safe, reliable and useful.
The more LPT you own as an orchestrator, the more work you can do to receive crypto again in exchange for this work. As the network continues to grow, the demand for orchestrators continues to grow. This has the direct consequence that the demand for LPT also increases.
But what if you do own LPT tokens, but don’t have the time or don’t have enough technical knowledge to be an orchestrator? Then we arrive at the second role that Livepeer has created, that of delegator.
Who are the delegates?
The delegators are the token holders on the Livepeer network, who stake their LPT tokens. They then choose themselves with which orchestrators they put their tokens. So honesty and good work by the orchestrators are guidelines that are used. You can see the discontinuation as a kind of deposit in this case. When the LPT token is discontinued, these are locked up for a pre-agreed period, and you cannot use them elsewhere. When this stake period is over, you will get your tokens back, including your yield (a kind of interest) or you will stake again, for example with a different orchestrator. In this way, the network becomes and remains secure.
The next image shows an orchestrator conducting everything and a delegator with two pockets full of the LPT token, ready to strike.
To discontinue the LPT token, why?
The orchestrator and the delegator both receive a share of the costs that a broadcaster pays to use the network. In addition, Livepeer regularly mints new tokens, which are then distributed between the orchestrators and delegators, with a distribution key. The more you strike, the more new tokens you get . The LPT token is therefore inflationary. If you have LPT tokens, and don’t strike them, you own a shrinking part of the network. If you do go on strike, your share in the network will increase.
An important reason is that orchestrators have a great economic advantage in this way over traditional centralized video stream providers. This is because the value of the LPT tokens they get is more than what they have to charge a broadcaster to break even. However, traditional, centralized video providers must not only charge for the cost of transcoding and distributing the videos, but also a profit margin. And right here lies the advantage of Livepeer, and see the reason why they can offer a cheaper service . It also makes it clearer why an orchestrator must be honest and do a good job. This is an important reason for how the network can continue to grow.
The following video explains how to stake the Livepeer token.
Who is behind the Livepeer project?
The people behind the Livepeer project are not the best. To come up with this idea and its implementation, you need to have some technical knowledge. The founders and team members have that to a large extent.
- Doug Petkanics – CEO, in 2016 he co-founded Livepeer. Prior to that, he was co-founder and VP of Engineering of Hyperpublic (bought by Groupon) and Wildcard Inc (one of Apple’s Apps of the Year in 2015).
- Eric Tang – CTO and co-founder of Livepeer. Was Lead Developer at Hyperpublic and co-founder and CTO of Wildcard.
- Philipp Angele – Director of Video Product. Co-founded Camcast and Camfoo. Video tech wizard.
- Yondon Fu – Lead Engineer.
Their website lists 15 people in their team, with diverse roles and functions. There is enough technical know-how and experience in this team, which is important to further develop the project.
What is the LPT token?
The LPT token is an ERC20 token. It is Livepeer’s protocol token, not a medium of exchange . You can buy it at various exchanges, more about this in a moment. As we have already seen, staking is an important part of the function of the LPT token.
New tokens are minted in so-called ’rounds’. These rounds are measured in Ethereum blocks, and each round consists of 5760 Ethereum blocks. A block is mined every 11.14 seconds, so every Livepeer round lasts every 17.82 hours. Assuming that the orchestrator with whom you have a stake does its job well, this is how often you get a reward.
Then there is also the inflation rate , or how Livepeer protocol calculates how many LPT tokens should be minted during each round. Suppose the inflation rate is 0.01965% and the tokens in circulation is 24,089,577.44. That means that in the next round, 4,733.6 tokens will be mined and paid out to all participants. Livepeer adjusts this inflation rate for each round. It looks at how many tokens are being staked out of the amount of tokens in circulation.
What is the participation rate?
Suppose there are indeed 24,089,577.44 tokens in circulation, and that 12,064,208.76 are being staked. Then the so-called ‘participation rate’ is 50.08%. Livepeer considers this a healthy percentage, all around 50%. This creates a healthy balance between network security and token liquidity. To maintain this percentage, the inflation rate is increased by 0.00005% for each round if the participant ratio is below 50%. Conversely, this ratio is increased by 0.00005% if the participant ratio is above 50%.
According to CoinMarketCap, there are 21,164,655.33 LPT in circulation, which is 92% of the max supply, which is 22,906,951 tokens.
At the time of writing, August 2021, there are over 2,900 delegators, a number that is growing almost daily.
What is the price of the LPT token?
If you want to invest in the LPT token, a good start is to know what the price is. If you are already going to trade, you also want to make a profit. You can make a technical analysis to see what the best buy or sell moment is.
The LPT token has had a price below $10 until mid-March 2021. It then went up steeply to hit the preliminary ATH (all time high) on May 10 at $43.88. After that, the price has also fallen again and at the time of writing, August 2021, the price is $19.78.
At CoinMarketCap , it is outside the top 100 in 145th place. This coin has a good sentiment in the market and I think it could have some good price development. If you want to invest in this coin, it is important to do your own research.
Where can you buy the LPT token?
The LPT token is for sale on Bitvavo and Binance . Bitvavo has included this coin in its offer at the end of August 2021. Most leading CEXs also offer this coin, such as Gate.io and KuCoin . Click below to buy on Bitvavo.
How can you keep the LPT tokens safe?
You have several options to keep these tokens safe. The best way is to store them on a hard wallet , also known as a cold wallet. With a hard wallet, such as the Ledger X or S and the Trezor, you are protected against internet hacks.
You can also leave the tokens on a CEX like Bitvavo. However, this does not protect you against a hack of the stock market. We also call these wallets hot wallets.
As a third option, you can also use an online wallet such as MetaMask or Trust wallet. Here is also another chance of an internet hack, but it is theoretically smaller than a hack on a stock exchange.
Livepeer is the first project that enables decentralized live streaming with a reward for the ‘orchestrators’ and the ‘delegators’. There are other hijackers on the coast that also want to tackle the high streaming costs in a decentralized way. However, these all use different ways. The success of Livepeer will depend, among other things, on whether they are sufficiently scalable to meet demand. If she can do this in a cheap way, there is a potentially great future for this project in the making .
Web3 apps are on the rise, and Livepeer can become a reliable provider for live streams. The current global pandemic has made that advance clear. In any case, the number of orchestrators continues to grow steadily, which is certainly a good sign. I think it is very worthwhile to keep an eye on this project. If you want to invest in the LPT token, at least do your own research.
Thanh Lanh Tran(1989) is Chief Editor from BitcoinUSD.com