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Cyclic arbitrage chances exist abundantly among decentralized exchanges (DEXs), like Uniswap V2. For an arbitrage cycle (loop), researchers or practitioners usually choose a specific token, such as Ether as input, and optimize their input…

Computational Finance · Quantitative Finance 2024-06-25 Yu Zhang , Zichen Li , Tao Yan , Qianyu Liu , Nicolo Vallarano , Claudio Tessone

Decentralized exchanges (DEXs) form a cornerstone of the decentralized finance (DeFi) ecosystem, processing token trades worth billions of dollars daily. Yet, a significant fraction of these trades are suboptimal: alternative routing paths…

Computational Engineering, Finance, and Science · Computer Science 2025-09-26 Yu Zhang , Claudio J. Tessone

The efficiency of decentralized exchanges (DEXs) and the influence of token routing algorithms on market performance and stakeholder outcomes remain underexplored. This paper introduces the concept of Standardized Total Arbitrage Profit…

Trading and Market Microstructure · Quantitative Finance 2025-08-06 Yu Zhang , Claudio J. Tessone

Decentralized exchanges, such as those employing constant product market makers (CPMMs) like Uniswap V2, play a crucial role in the blockchain ecosystem by enabling peer-to-peer token swaps without intermediaries. Despite the increasing…

Computational Finance · Quantitative Finance 2025-04-23 Yu Zhang , Yafei Li , Claudio Tessone

Decentralized finance (DeFi) markets spread across Layer-1 (L1) and Layer-2 (L2) blockchains rely on arbitrage to keep prices aligned. Today most price gaps are closed against centralized exchanges (CEXes), whose deep liquidity and fast…

Cryptography and Security · Computer Science 2025-06-19 Burak Öz , Christof Ferreira Torres , Christoph Schlegel , Bruno Mazorra , Jonas Gebele , Filip Rezabek , Florian Matthes

In this paper, we investigate two methods that allow us to automatically create profitable DeFi trades, one well-suited to arbitrage and the other applicable to more complicated settings. We first adopt the Bellman-Ford-Moore algorithm with…

Cryptography and Security · Computer Science 2021-03-04 Liyi Zhou , Kaihua Qin , Antoine Cully , Benjamin Livshits , Arthur Gervais

This student paper introduces a novel methodology for the detection and analysis of multihop cross-chain arbitrage opportunities, wherein multihop denotes arbitrage sequences involving more than two transactional steps across distinct…

Other Computer Science · Computer Science 2026-01-08 Davide Mancino , Hasret Ozan Sevim , Oriol Saguillo Gonzalez

Multi-Agent Path Finding (MAPF) involves finding collision-free paths for multiple agents while minimizing a cost function--an NP-hard problem. Bounded suboptimal methods like Enhanced Conflict-Based Search (ECBS) and Explicit Estimation…

Multiagent Systems · Computer Science 2025-08-07 Yimin Tang , Zhenghong Yu , Jiaoyang Li , Sven Koenig

Decentralized Exchanges (DEXes) enable users to create markets for exchanging any pair of cryptocurrencies. The direct exchange rate of two tokens may not match the cross-exchange rate in the market, and such price discrepancies open up…

Trading and Market Microstructure · Quantitative Finance 2022-01-17 Ye Wang , Yan Chen , Haotian Wu , Liyi Zhou , Shuiguang Deng , Roger Wattenhofer

In the ever evolving landscape of decentralized finance automated market makers (AMMs) play a key role: they provide a market place for trading assets in a decentralized manner. For so-called bluechip pairs, arbitrage activity provides a…

Statistical Finance · Quantitative Finance 2025-05-16 Abe Alexander , Lars Fritz

Decentralized Finance (DeFi) is a rapidly evolving segment of blockchain technology that enables a transformative approach to financial services through Web3 applications. By leveraging smart contracts, DeFi allows developers to build…

Distributed, Parallel, and Cluster Computing · Computer Science 2026-05-01 Ignat Melnikov , Roman Vlasov , Vladimir Gorgadze , Andrey Seoev , Yury Yanovich

We develop a mixed control framework that combines absolutely continuous controls with impulse interventions subject to stochastic execution delays. The model extends current impulse control formulations by allowing (i) the controller to…

Trading and Market Microstructure · Quantitative Finance 2026-02-20 Philippe Bergault , Yadh Hafsi , Leandro Sánchez-Betancourt

Decentralized Exchanges (DEXs) are pivotal applications in the Decentralized Finance (DeFi) landscape, aiming to facilitate trustless cryptocurrency trading by relying on smart contracts and blockchain networks. The developments in the DEXs…

Computational Engineering, Finance, and Science · Computer Science 2024-11-05 Mohammad Ali Asef , Seyed Mojtaba Hosseini Bamakan

In this paper, we consider the problem of distributed optimisation of a separable convex cost function over a graph, where every edge and node in the graph could carry both linear equality and/or inequality constraints. We show how to…

Distributed, Parallel, and Cluster Computing · Computer Science 2024-02-20 Richard Heusdens , Guoqiang Zhang

Decentralized exchanges (DEXs) are crucial to decentralized finance (DeFi) as they enable trading without intermediaries. However, they face challenges like impermanent loss (IL), where liquidity providers (LPs) see their assets' value…

Computer Science and Game Theory · Computer Science 2026-03-04 Irina Lebedeva , Dmitrii Umnov , Yury Yanovich , Ignat Melnikov , George Ovchinnikov

Decentralized exchanges using automated market makers create arbitrage opportunities with centralized exchanges, where gas fees and transaction ordering are critical. Existing models largely overlook competition among arbitrageurs, despite…

Mathematical Finance · Quantitative Finance 2026-02-27 Xue Dong He , Chen Yang , Yutian Zhou

This work addresses a Multi-Objective Shortest Path Problem (MO-SPP) on a graph where the goal is to find a set of Pareto-optimal solutions from a start node to a destination in the graph. A family of approaches based on MOA* have been…

Artificial Intelligence · Computer Science 2022-05-31 Zhongqiang Ren , Richard Zhan , Sivakumar Rathinam , Maxim Likhachev , Howie Choset

Decentralized Exchanges (DEXs) are new types of marketplaces leveraging Blockchain technology. They allow users to trade assets with Automatic Market Makers (AMM), using funds provided by liquidity providers, removing the need for order…

Computer Science and Game Theory · Computer Science 2023-02-08 Yogev Bar-On , Yishay Mansour

The asset trading volume on blockchain-based exchanges (DEX) increased substantially since the advent of Automated Market Makers (AMM). Yet, AMMs and their forks compete on the same blockchain, incurring unnecessary network and block-space…

Cryptography and Security · Computer Science 2021-06-21 Liyi Zhou , Kaihua Qin , Arthur Gervais

We study a distributed decision-making problem in which multiple agents face the same multi-armed bandit (MAB), and each agent makes sequential choices among arms to maximize its own individual reward. The agents cooperate by sharing their…

Optimization and Control · Mathematics 2020-08-13 Peter Landgren , Vaibhav Srivastava , Naomi Ehrich Leonard
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