The Tension Between Divergence Loss and Profit in Automated Market Makers
In today’s post we take the perspective of a liquidity provider (LP) and ask: how much you can expect to earn by providing tokens to the reserve pools?
Automated Market Making Mechanisms and Issues in Uniswap, Balancer, and Curve
Early decentralized exchange (DEX) proposals took their inspiration from classical exchange markets and made use of order books to match sell and buy orders. A complementary approach to offchain order books for decentralized exchanges uses the concept of automated market makers (AMMs). In this post we look at the basics of the following three AMM projects: Uniswap, Balancer, and Curve.