DEX Market Landscape: Uniswap vs Everyone by Vladimir Tikhomirov (@vtikhomirov75)

Transcript

okay hello everyone my name is lat I'm from algebra and today we'll talk about okay thanks today we'll talk about our experience and all the dex's environment right now so by the way we have prepared special report for this event so we combined liquidity data around the Texas and if you are interested you can scan the code and write to my colleague and he will send it to you I will also show this after the presentation also so we'll move forward so a very short story about us so we started as a decks in 2021 I think two years ago and failed because we didn't

able to attract liquidity and after this we decided to move from the own decks to the protocol and right now I think you know all know these names which is working with us is a quick swap cyber stereo Spirit Swap and many many other taxes use our engine for their products we are constraint liquidity decks I mean engine with a dynamic fees for the pools with the farming with their base token support and limit orders will come soon uh yesterday volume was uh I think it's wrong it was 150 million uh across all our partners so let's talk about Nexus

we believe that it's still a main application across all the blockchains because it it connects the protocols between each other so it's not just uh I don't know any new wallet or something like this so it's application which help other applications to perform on the blockchain and also from my perspective dexas are important because they help projects to grow by attracting fundrais because you do not need to wait centralized exchange list your token you can just launch it on the decks and continue operation and people can buy more tokens use your project and so on exchange are extremely big in comparison

with the taxes and I would not believe that it's a problem with you know that some people don't know how to use the access or it's institutional Finance which is uh don't like the dexas and go to the Texas we believe that it's some critical problems in the dexas which needs to be changed before we start big fight with the centralized Exchange as they are price Discovery problems we will discover we will discuss it later may have sandwiches still a lot of bugs and of course Implement laws so let's review our categorization of the Dex Zoo so we categorize the access by type how they know about the price first of all it's

amm so you know the price is inside of the decks so it doesn't matter what the price of the token or the binance uh price on mm is just a state of the pools so it's it's out of the space pmm when we know price from the oracles club or its limit orders so people put the orders and that's how when they send the price and RFQ it's uh also mostly the same so people sense request for the price so we'll talk about amm mostly because we focus on this one and you know with mm it's like uni swap I know Sushi curve and many others the main problem that

you know mm is a passive uh participant of the of the market so I think it's a very good example of implement laws so just imagine that you have a tokens and at some moments somebody can come to you and say okay I want to buy this for this price and doesn't matter you agree it or not you will sell it so that's how amm works and how we got Implement loss so it will work even if it's a bad price for you and for Dex because it's how it's designed so we believe that it's one of the critical issues of oemms that is playing uh very passive role in the trading for the users for Equity providers and we try to change it on the next slide you can see the main

participant on the Dex it's liquidity providers who need Capital efficiency no we need to get more money from their liquidity it's a traders who care about price impact and unfortunately we have Arbitrage which love uh price low price Discovery time so delays with the price Discovery inefficiencies like may have sandwiches and so on and fortunately unfortunately current taxes are not working good without this uh this role however Arbitrage get profits from the Traders and Equity providers uh let's go to the story so first generation amm Dex as it was like Union swap version 2 curve it's what is the

problem that it was one invariant of the price for all type of the players so does it matter you're talking about players with the Stables or you're talking about answer against usdc always the same and Story shows us that is wrong and that's how we got constraint equity as a concept when you can add liquidity surprise ranges and that's how it's we can create new invariants depending on the pairs so this example with our friends from polygon and when uh uni swap comes to the polygon you see it was Zero volume and just several days it got 70 percent of all volume on polygon on the across

all the dexes so this shows how constraint liquidity concept is uh much more powerful than all the V2 concept which we have right now the same situation with the arbit room so it's much more better so I think it's about 50 and I hope that in the end one of our partner called cyber uh eat a lot from uni swap but it's still diminishing technology there so some problems with the constraint liquid is here it's first of all it's a huge impermanent loss so people lose a lot by providing there multiple pools you have to decide to what pool you need to put the liquidity it's more it's almost no farming on constraint liquids models right now and

also not all the tokens are supported like rebe stockings are not supported on useful version 3 but supported on previous versions so let's talk how we can fix the problem with uh situation when a pool does not care about liquidity providers so right now how it works you just put the money and you have to predict what happened next when you need to take it back or stay continue to be staying inside of the as a liquidity provider but Traders are happy so they have standard fee they have low price impact but we believe that needs to be changed enter this algebra approach so we change

the fees in the pool depending on what happened to the market so for example if we see that pair is not volatile let's say two Stables usdc against usdc we believe that a slow risk for liquidity providers and we decrease the fees to attract more volume and otherwise if we see the pair is volatile we increase the fees and it means that we get more profit for liquidity providers this perfect example how it works so I think everyone knows about what happens on weekend and we see the price of usdc against us this year on left side how usdc goes down

and it means that at this moment our algorithm understands that we need to change uh fees because there is huge risk of employment laws for people who provided liquidity to the pool and you can see on the right side we immediately increase the fee for the spool so to compensate possible uh losses because of a huge price impact which happened in stable pool before and you can see after this price stabilized we go to almost zero three Equity seats like 0.01 0.3 percent or one percent pool we have only one pool but it's automatically adjusted to what pair is separated what's this next step for us so we plan

to launch limit orders without third parties so it will be the decks with the limiters there is no need to work with gelata or any other services to execute your limit order so it will be executed automatically buy the Traders we are fighting with the toxic flow also some words about Layer Two Solutions you know that if you have a protocol on ethereum or binance machine if you decide to go to arbit room or optimism you have to redesign your contracts a little bit because every transaction some information needs to be stored and you need to think how to reduce this amount of information otherwise gas costs will be so high and also looking forward for ethereum

introduction of abstractic accounts and we hope that it will help not only us but all the taxes so to summarize uh we are one of the most I believe popular and Powerful DX engines and it was recognized by many many our partners who will use use our engine every day and uh we one of the first who provide farming for question based token support and limit order soon so thank you very much for your attention so there's a link to the report and you are welcome all also to our boost to discuss any questions and happy to be here thanks very much for organizers thank you very much

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