An analysis of Uniswap markets
Uniswap -- and other constant product markets -- appear to work well in practice despite their simplicity. In this paper, we give a simple formal analysis of constant product markets and their generalizations, showing that, under some common conditions, these markets must closely track the reference market price. We also show that Uniswap satisfies many other desirable properties and numerically demonstrate, via a large-scale agent-based simulation, that Uniswap is stable under a wide range of market conditions.
Code (0)
등록된 구현이 없습니다.
Similar Papers 제목 키워드 기반
Exploring Price Accuracy on Uniswap V3 in Times of Distress
Financial markets have evolved over centuries, and exchanges have converged to rely on the order book mechanism for market making. Latency on the blockchain, however, has prevented decentralized exchanges (DEXes) from ut…
Pool Value Replication (CPM) and Impermanent Loss Hedging
This work analytically characterizes impermanent loss for automated market makers (AMMs) in decentralized markets such as Uniswap or Balancer (CPMM). We derive a static replication formula for the pool's value using a co…
Static Replication of Impermanent Loss for Concentrated Liquidity Provision in Decentralised Markets
This article analytically characterizes the impermanent loss of concentrated liquidity provision for automatic market makers in decentralised markets such as Uniswap. We propose two static replication formulas for the im…
Panoptic: the perpetual, oracle-free options protocol
Panoptic is the perpetual, oracle-free, instant-settlement options trading protocol on the Ethereum blockchain. Panoptic enables the permissionless trading of options on top of any asset pool in the Uniswap v3 ecosystem …
A Sea of Coins: The Proliferation of Cryptocurrencies in UniswapV2
Blockchain technology has revolutionized financial markets by enabling decentralized exchanges (DEXs) that operate without intermediaries. Uniswap V2, a leading DEX, facilitates the rapid creation and trading of new toke…