Silkswap: An asymmetric automated market maker model for stablecoins
Computational Finance
2023-02-16 v1 General Economics
Economics
Pricing of Securities
Trading and Market Microstructure
Abstract
Silkswap is an automated market maker model designed for efficient stablecoin trading with minimal price impact. The original purpose of Silkswap is to facilitate the trading of fiat-pegged stablecoins with the stablecoin Silk, but it can be applied to any pair of stablecoins. The Silkswap invariant is a hybrid function that generates an asymmetric price impact curve. We present the derivation of the Silkswap model and its mathematical properties. We also compare different numerical methods used to solve the invariant equation. Finally, we compare our model with the well-known Curve Finance model.
Keywords
Cite
@article{arxiv.2302.07822,
title = {Silkswap: An asymmetric automated market maker model for stablecoins},
author = {Nicola Cantarutti and Alex Harker and Carter Woetzel},
journal= {arXiv preprint arXiv:2302.07822},
year = {2023}
}