We consider the market microstructure of constant function market makers (CFMMs) from the
perspective of passive liquidity providers (LPs). In a Black-Scholes setting, we compare the …

We consider the impact of trading fees on the profits of arbitrageurs trading against an
automated marker marker (AMM) or, equivalently, on the adverse selection incurred by …

Decentralized exchanges (DEXs) provide a means for users to trade pairs of assets on-
chain without the need of a trusted third party to effectuate a trade. Amongst these, constant …

Constant Function Market Makers (CFMMs) are a tool for creating exchange markets, have
been deployed effectively in prediction markets, and are now especially prominent in the …

In decentralized finance (" DeFi"), automated market makers (AMMs) enable traders to
programmatically exchange one asset for another. Such trades are enabled by the assets …

We provide an economic model of a decentralized exchange (DEX) that allows investors to
concentrate liquidity within exogenously specified price intervals (eg, Uniswap V3). We …

We consider the market microstructure of automated market making and, specifically,
constant function market makers (CFMMs), from the economic perspective of passive …

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We introduce a new comprehensive and model-free measure for the unhedgeable and
predictable loss (PL) incurred by liquidity providers (LPs) in constant function markets …

This paper presents a general framework for the design and analysis of exchange
mechanisms between two assets that unifies and enables comparisons between the two …