Concentrated Liquidity in Automated Market Makers

Robin Fritsch

Papers from arXiv.org

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.

Date: 2021-10
New Economics Papers: this item is included in nep-fmk and nep-mst
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Citations: View citations in EconPapers (2)

Published in Proceedings of the 2021 ACM CCS Workshop on Decentralized Finance and Security (2021) 15-20

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Persistent link: https://EconPapers.repec.org/RePEc:arx:papers:2110.01368

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