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Finanzas Descentralizadas en Blockchain: Automated Market Makers, Swaps y Arbitraje

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20/07/2022| By
Álvaro Álvaro Jiménez Mesa
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Abstract

The maturity of the financial sector is pushing institutional centralization to the extreme. The irruption of Blockchain technology seems to be celebrated as a way to evade the barriers and asymmetry of a system increasingly biased. Decentralized Finance has inaugurated a new stage where capital trading has a whole new meaning. Not only has it originated new crypto assets, but it has also bred the development of new protocols and markets that establish an accessible, fair and transparent financial system. The detachment from conventional finance lies in disintermediation, automation and decentralization. Automated Market Makers make up the paradigm in which Decentralized Exchanges operate. Specifically, Uniswap served as the precursor protocol of this model satisfying the supply and demand of liquidity providers and traders through automatic platforms of reserves or Liquidity Pools. By combining these elements with the Constant Function Market Maker configuration, Uniswap AMM achieves an optimal trading solution in decentralized markets while maximizing capital efficiency. In parallel to Uniswap, numerous facilities are settled in the environment for cryptoasset trading. This ends up incubating an ecosystem that promotes symbiosis and interoperability resulting in fluctuation of values, being subjected to considerable risk. Nevertheless, this context is the right place for High Frequency Trading, that makes use of strategies such as arbitrage. This project will culminate in the proposal of a tool that can offer utility in executing these operations.

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Submitted by20 Jul 2022
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  • License: CC0
  • Review type: Open Review
  • Publication type: Article

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