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Uniswap Liquidity Provision: An Online Learning Approach

Research output: Chapter in Book/Report/Conference proceedingConference contributionpeer-review

Abstract

Uniswap v3 is a decentralized exchange (DEX) that allows liquidity providers to allocate funds more efficiently by specifying an active price interval for their funds. This introduces the problem of finding an optimal strategy for choosing price intervals. We formalize this problem as an online learning problem with non-stochastic rewards. We use regret-minimization methods to show a Liquidity Provision strategy that guarantees a lower bound on the reward. This is true even for non-stochastic changes to asset pricing, and we express this bound in terms of the trading volume and the average price change.

Original languageEnglish
Title of host publicationFinancial Cryptography and Data Security. FC 2023 International Workshops - Voting, CoDecFin, DeFi, WTSC, Revised Selected Papers
EditorsAleksander Essex, Shin’ichiro Matsuo, Oksana Kulyk, Lewis Gudgeon, Ariah Klages-Mundt, Daniel Perez, Sam Werner, Andrea Bracciali, Geoff Goodell
PublisherSpringer Science and Business Media Deutschland GmbH
Pages247-261
Number of pages15
ISBN (Print)9783031488054
DOIs
StatePublished - 2024
Event4th Workshop on Coordination of Decentralized Finance, CoDecFin 2023, 3rd Workshop on Decentralized Finance, DeFi 2023, 8th Workshop on Advances in Secure Electronic Voting, VOTING 2023, and 7th Workshop on Trusted Smart Contracts, WTSC 2023, held in As... - Bol, Croatia
Duration: 5 May 20235 May 2023

Publication series

NameLecture Notes in Computer Science
Volume13953 LNCS

Conference

Conference4th Workshop on Coordination of Decentralized Finance, CoDecFin 2023, 3rd Workshop on Decentralized Finance, DeFi 2023, 8th Workshop on Advances in Secure Electronic Voting, VOTING 2023, and 7th Workshop on Trusted Smart Contracts, WTSC 2023, held in As...
Country/TerritoryCroatia
CityBol
Period5/05/235/05/23

ASJC Scopus subject areas

  • Theoretical Computer Science
  • General Computer Science

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