Related papers: Optimal Algorithmic Monetary Policy
Cryptocurrencies are examined through the asset flow equations and experimental asset markets. Since tangible value of a typical cryptocurrency is non-existent, the theory suggests that price will gravitate toward liquidity value, i.e., the…
Two of the most important technological advancements currently underway are the advent of quantum technologies, and the transitioning of global financial systems towards cryptographic assets, notably blockchain-based cryptocurrencies and…
Stablecoins have gained significant popularity recently, with their market cap rising to over $180 billion. However, recent events have raised concerns about their stability. In this paper, we classify stablecoins into four types based on…
In the high-stakes race to develop more scalable blockchains, some platforms (Binance, Cosmos, EOS, TRON, etc.) have adopted committee-based consensus (CBC) protocols, whereby the blockchain's record-keeping rights are entrusted to a…
Decentralized policy optimization has been commonly used in cooperative multi-agent tasks. However, since all agents are updating their policies simultaneously, from the perspective of individual agents, the environment is non-stationary,…
We propose the formal study of governed blockchains that are owned and controlled by organizations and that neither create cryptocurrencies nor provide any incentives to solvers of cryptographic puzzles. We view such approaches as…
We study long-term equilibria that arise in the token monetary policy, or tokenomics, design of proof-of-stake (PoS) blockchain systems that engage utility maximizing users and validators. Validators are system maintainers who get rewarded…
Price benchmarks are used to incorporate market price trends into contracts, but their use can create opportunities for manipulation by parties involved in the contract. This paper examines this issue using a realistic and tractable model…
Decentralized Ledger Technology, popularized by the Bitcoin network, aims to keep track of a ledger of valid transactions between agents of a virtual economy without a central institution for coordination. In order to keep track of a…
Blockchains enables tamper-proof, ordered logging for transactional data in a decentralized manner over open-access, overlay peer-to-peer networks. In this paper, we propose a decentralized framework of proactive caching in a hierarchical…
Public blockchains should be able to scale with respect to the number of nodes and to the transactions workload. The blockchain scalability trilemma has been informally conjectured. This is related to scalability, security and…
The `Black Thursday' crisis in cryptocurrency markets demonstrated deleveraging risks in over-collateralized non-custodial stablecoins. We develop a stochastic model that helps explain deleveraging crises in these over-collateralized…
Sharding is used to improve the scalability and performance of blockchain systems. We investigate the stability of blockchain sharding, where transactions are continuously generated by an adversarial model. The system consists of $n$…
This paper explores neural network-based approaches for algorithmic trading in cryptocurrency markets. Our approach combines multi-timeframe trend analysis with high-frequency direction prediction networks, achieving positive risk-adjusted…
Blockchains with smart contracts are distributed ledger systems that achieve block-state consistency among distributed nodes by only allowing deterministic operations of smart contracts. However, the power of smart contracts is enabled by…
The Financial system has witnessed rapid technological changes. The rise of Bitcoin and other crypto assets based on Distributed Ledger Technology mark a fundamental change in the way people transact and transmit value over a decentralized…
We study the implications of a central bank digital currency (CBDC) for the transmission of household preference shocks and for welfare in a New Keynesian framework where the CBDC competes with bank deposits for household resources and…
Payment networks, also known as channels, are a most promising solution to the throughput problem of cryptocurrencies. In this paper we study the design of capital-efficient payment networks, offline as well as online variants. We want to…
We develop a new type of automated market maker (AMM) that helps to maintain stability and long-term viability in a stablecoin. This primary market AMM (P-AMM) is an autonomous mechanism for pricing minting and redemption of stablecoins in…
Blockchains have shown great promise as peer-to-peer digital currency systems over the past 10 years. However, with increased popularity, the demand for processing transactions has also grown leading to increased costs, confirmation times,…