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SBF
@SBF_FTX
1) One reason I agree with
@KyleSamani
-- when an aggregator combines fungible products, they are basically 'doing an arb'--telling a customer "instead of buying on X, buy on Y". So take what you were going to do, buy on Y, and sell on X. That's arbing the platforms.
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Composability Kyle
@KyleSamani
0/ There is a lot of talk about aggregators in DeFi Lots of competition on both the supply and demand side People are relying on Stratechery's Aggregation Theory framework I don't think aggregation theory actually applies on either the supply or demand side in DeFi twitter.com/jpurd17/status…
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SBF
@SBF_FTX
2) So instead of aggregating and redirecting, why doesn't the aggregator just let customers do what they will and then do the arbs itself after? Well that doesn't sound so good--there are giant companies that do arbs professionally, an aggregator prob wouldn't win.
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SBF
@SBF_FTX
3) So if it wouldn't win doing the arb, how can it win by letting customers do the arb? Well, it can save fees and charge some to users. So it's worth a bit, but not a ton. But if a customer is really fee-sensitive they won't pay the aggregator fees, they'll do it themselves.
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SBF
@SBF_FTX
4) So aggregating arb-able markets prob isn't *that* good. But there's another thing that aggregators can do: thread things together. This won't save fees but it can save time, and everyone wants time! So putting together Compound + Uniswap --> margin trading would be cool.
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