allbits @allbits11

I hold these tweets to be self evident Joined June 2019

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allbits @allbits11

3 years ago

@0x94305 You neglected to say that the LVR problem is here to stay *on Ethereum*, or, more broadly, *on VM-based account model blockchains*. LVR is solved elegantly by mechanism design and market dynamics, using blockchain, and so marking a definitive improvement on tradfi and "defi"

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allbits @allbits11

3 years ago

So much summed up in an ironic post. It's the current state of things. Fortunately, blockchain allows for mechanisms that do away with the worst of tradfi rather than emulate it. We just haven't seen it in the wild yet

Gwart @GwartyGwart

3 years ago

I hope all of you MEV searchers had a really good time out there and made a lot of friends along the way because Citadel has arrived and they are, in fact, much better at ordering transactions than you are

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allbits @allbits11

3 years ago

@0x94305 The biggest issues you highlight have been solved, but not on Ethereum because generalized VMs are not an optimal foundation for efficient DExes. Engineering and gas overhead are likely too high to solve these on Ethereum. But an elegant solution using smart txs has been achieved

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allbits @allbits11

3 years ago

It would be much much better if I could just send my conversion tx onchain and be guaranteed best execution price at settlement simply because of mechanism design and the dynamics of the system

Xin Wan @xin__wan

3 years ago

Who’s ready to build the most powerful routing engine that finds the best path across the one million v4 pools, each with its own hook?

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allbits @allbits11

3 years ago

@atiselsts_eth The "loss" is risk-adjusted. This means absolute results can be profitable in a particular case but the LP still lost because their financial results would have been much better if they took the same risk in other venues (eg. rebalancing on CEX, or LPing on superior mechanism)

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allbits @allbits11

3 years ago

@atiselsts_eth Driving force of LVR is due to two prices that arise from an AMM tx. One is "realized price" which is what user receives on the tx. The other is "implied price" which is the new state of the AMM. Profit max arbs will make implied=market, and realized<market. Arbs win, LPs lose

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allbits @allbits11

3 years ago

@0x94305 Thank you for the great thread ... again!

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allbits @allbits11

3 years ago

They state this as if it's universally true because they're locked inside their paradigm. I agree with them that it's true in uniswap. But it's not a universal truth for AMMs

Uniswap @Uniswap

3 years ago

4/ Liquidity also impacts price slippage 🌀 If you have plenty of tokens in a pool, price impact should be minimal. But if liquidity is low, larger trades can affect token price.

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allbits @allbits11

3 years ago

See, they always knew it was neither efficient nor effective. Because of LVR

Uniswap @Uniswap

3 years ago

4/ FLAIR represents an important step towards improving the efficiency & effectiveness of LPing in AMMs. In the graph, current models equate the green & blue pools with low flow-toxicity. FLAIR separates these by measuring LP competitiveness, showing an important 2nd dimension.

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allbits @allbits11

3 years ago

@haikane yes - you seem to assume that it's necessary for every DEX to be implemented by smart contracts operating over a consensus base layer, and so txs through an AMM must be completed serially. That assumption gives rise to all of these problems and prevents elegant solutions

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allbits @allbits11

3 years ago

The thing is, Hayden doesn't care at all about looking at the full solution set for these issues. Instead, bagholder logic leads to him promoting "solutions" via analogies where people shoot each other in the back of the head. So sad.

allbits @allbits11

3 years ago

And yet blockchain technology that isn't flawed from the get go is perfectly suited to more elegant, cooperative and efficient mechanisms

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allbits @allbits11

3 years ago

And yet blockchain technology that isn't flawed from the get go is perfectly suited to more elegant, cooperative and efficient mechanisms

Hayden Adams 🦄 @haydenzadams

3 years ago

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allbits @allbits11

3 years ago

oNLy pOSsiBLe oN sOLaNa

Helius @Helius

3 years ago

Fetching all the NFTs an address owns on Solana is generally slow and unreliable with the new Digital Asset Standard (DAS) API, you can now get ALL nfts — compressed and regular — in a single, blazing-fast RPC call! only possible on Solana check it out:

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allbits @allbits11

3 years ago

The fundamental challenge he has in analyzing this is that he implicitly and automatically accepts the received "wisdom" that decentralized apps shall be implemented via smart contracts over a generalized VM base layer. Unfortunately, it means systems that aren't fit for purpose.

3 years ago

Neat stuff: @SmileeFinance is building "smile" derivatives that have the inverse of an LP's payoff AMM LPs are betting on a sideways market and hoping fees will exceed their IL Smile buyers pay a premium and are hoping for an "impermanent gain" (IG) that exceeds their premium