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This article explores the optimisation of trading strategies in Constant Function Market Makers (CFMMs) and centralised exchanges. We develop a model that accounts for the interaction between these two markets, estimating the conditional…

Trading and Market Microstructure · Quantitative Finance 2026-05-06 Sebastian Jaimungal , Yuri F. Saporito , Max O. Souza , Yuri Thamsten

Auctions play an important role in electronic commerce, and have been used to solve problems in distributed computing. Automated approaches to designing effective auction mechanisms are helpful in reducing the burden of traditional game…

Computer Science and Game Theory · Computer Science 2010-02-08 Jinzhong Niu , Kai Cai , Simon Parsons

In this paper, reinforcement learning is applied to the problem of optimizing market making. A multi-agent reinforcement learning framework is used to optimally place limit orders that lead to successful trades. The framework consists of…

Trading and Market Microstructure · Quantitative Finance 2018-12-27 Yagna Patel

In decentralized finance ("DeFi"), automated market makers (AMMs) enable traders to programmatically exchange one asset for another. Such trades are enabled by the assets deposited by liquidity providers (LPs). The goal of this paper is to…

Computer Science and Game Theory · Computer Science 2023-11-29 Jason Milionis , Ciamac C. Moallemi , Tim Roughgarden

The transition to auto-bidding in online advertising has shifted the focus of auction theory from quasi-linear utility maximization to value maximization subject to financial constraints. We study mechanism design for buyers with private…

Computer Science and Game Theory · Computer Science 2026-02-24 Xiaodong Liu , Weiran Shen , Zihe Wang

In this work, we study spectrum auction problem where each request from secondary users has spatial, temporal, and spectral features. With the requests of secondary users and the reserve price of the primary user, our goal is to design…

Networking and Internet Architecture · Computer Science 2013-05-29 Yu-e Sun , He Huang , Xiang-Yang Li , Zhili Chen , Wei Yang , Hongli Xu , Liusheng Huang

Diffusion auction design is a new trend in mechanism design for which the main goal is to incentivize existing buyers to invite new buyers, who are their neighbors on a social network, to join an auction even though they are competitors.…

Computer Science and Game Theory · Computer Science 2024-08-26 Yao Zhang , Shanshan Zheng , Dengji Zhao

Digital advertising constitutes one of the main revenue sources for online platforms. In recent years, some advertisers tend to adopt auto-bidding tools to facilitate advertising performance optimization, making the classical \emph{utility…

Computer Science and Game Theory · Computer Science 2022-12-01 Hongtao Lv , Zhilin Zhang , Zhenzhe Zheng , Jinghan Liu , Chuan Yu , Lei Liu , Lizhen Cui , Fan Wu

We study simple and approximately optimal auctions for agents with a particular form of risk-averse preferences. We show that, for symmetric agents, the optimal revenue (given a prior distribution over the agent preferences) can be…

Computer Science and Game Theory · Computer Science 2013-01-04 Hu Fu , Jason Hartline , Darrell Hoy

As computational agents are developed for increasingly complicated e-commerce applications, the complexity of the decisions they face demands advances in artificial intelligence techniques. For example, an agent representing a seller in an…

Artificial Intelligence · Computer Science 2017-01-08 W. P. Birmingham , E. H. Durfee , S. Park

Non-orthogonal multiple access (NOMA) systems have the potential to deliver higher system throughput, compared to contemporary orthogonal multiple access techniques. For a linearly precoded multiple-input multiple-output (MISO) system, we…

Information Theory · Computer Science 2015-12-08 Muhammad Fainan Hanif , Zhiguo Ding , Tharmalingam Ratnarajah , George K. Karagiannidis

We present a number of models for the adword auctions used for pricing advertising slots on search engines such as Google, Yahoo! etc. We begin with a general problem formulation which allows the privately known valuation per click to be a…

Computer Science and Game Theory · Computer Science 2007-05-23 Garud Iyengar , Anuj Kumar

We introduce a new numerical framework to learn optimal bidding strategies in repeated auctions when the seller uses past bids to optimize her mechanism. Crucially, we do not assume that the bidders know what optimization mechanism is used…

Computer Science and Game Theory · Computer Science 2021-02-09 Thomas Nedelec , Jules Baudet , Vianney Perchet , Noureddine El Karoui

Many online companies sell advertisement space in second-price auctions with reserve. In this paper, we develop a probabilistic method to learn a profitable strategy to set the reserve price. We use historical auction data with features to…

Machine Learning · Statistics 2015-06-25 Maja R. Rudolph , Joseph G. Ellis , David M. Blei

Markets for zero-day exploits (software vulnerabilities unknown to the vendor) have a long history and a growing popularity. We study these markets from a revenue-maximizing mechanism design perspective. We first propose a theoretical model…

Computer Science and Game Theory · Computer Science 2020-06-26 Mingyu Guo , Hideaki Hata , Ali Babar

Automated market makers are a popular mechanism used on decentralized exchange, through which users trade assets with each other directly and automatically through a liquidity pool and a fixed pricing function. The liquidity provider…

Mathematical Finance · Quantitative Finance 2024-11-27 Xue Dong He , Chen Yang , Yutian Zhou

We develop a general duality-theory framework for revenue maximization in additive Bayesian auctions. The framework extends linear programming duality and complementarity to constraints with partial derivatives. The dual system reveals the…

Computer Science and Game Theory · Computer Science 2018-01-16 Yiannis Giannakopoulos , Elias Koutsoupias

Automated market makers (AMMs) have emerged as the dominant market mechanism for trading on decentralized exchanges implemented on blockchains. This paper presents a single mechanism that targets two important unsolved problems for AMMs:…

Trading and Market Microstructure · Quantitative Finance 2025-02-13 Austin Adams , Ciamac C. Moallemi , Sara Reynolds , Dan Robinson

We provide a computationally efficient black-box reduction from mechanism design to algorithm design in very general settings. Specifically, we give an approximation-preserving reduction from truthfully maximizing \emph{any} objective under…

Computer Science and Game Theory · Computer Science 2013-05-20 Yang Cai , Constantinos Daskalakis , S. Matthew Weinberg

Auction design for the modern advertising market has gained significant prominence in the field of game theory. With the recent rise of auto-bidding tools, an increasing number of advertisers in the market are utilizing these tools for…

Computer Science and Game Theory · Computer Science 2024-12-31 Changfeng Xu , Chao Peng , Chenyang Xu , Zhengfeng Yang