Authors

Tarun Chitra, Guillermo Angeris, Akshay Agrawal, Alex Evans, Stephen Boyd

July 1, 2021

Research

Constant Function Market Makers: Multi-Asset Trades via Convex Optimization

Key Takeaways

While traditional exchanges use order books to match and execute trades, DEXs are typically organized as constant function market makers (CFMMs).

When more than two assets are being exchanged, it is more difficult to understand the landscape of possible trades.

This paper observes that various problems of choosing a multi-asset trade can be formulated as convex optimization problems, and can therefore be reliably and efficiently solved.

Research

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