Concentrated Liquidity in Automated Market Makers
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Author / Producer
Date
2021-11-19
Publication Type
Conference Paper
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yes
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Abstract
We examine how the introduction of concentrated liquidity has changed the liquidity provision market in automated market makers such as Uniswap. To this end, we compare average liquidity provider returns from trading fees before and after its introduction. Furthermore, we quantify the performance of a number of fundamental concentrated liquidity strategies using historical trade data. We estimate their possible returns and evaluate which perform best for certain trading pairs and market conditions.
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Publication status
published
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Editor
Book title
DeFi '21: Proceedings of the 2021 ACM CCS Workshop on Decentralized Finance and Security
Journal / series
Volume
Pages / Article No.
15 - 20
Publisher
Association for Computing Machinery
Event
ACM Conference on Computer and Communications Security (CCS 2021)
Edition / version
Methods
Software
Geographic location
Date collected
Date created
Subject
blockchain; decentralized finance; automated market makers
Organisational unit
03604 - Wattenhofer, Roger / Wattenhofer, Roger