Super interesting technical discussions on both sides of the AMM debate tonight( and vs ). There are also plenty of practical reasons for Uniswap's strong PMF, though. Here's the bottom line for me, as an active Uniswap LP:
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For starters, where am I going to get my own personal on-chain algo trading firm with a single transaction? I don't have time or resources to build a bespoke AMM strategy.
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I also just don't really care about any of the inefficiencies. I have no other options, and I'm pretty confident that I'm going to make money off the trading fees blindly fading some of these pairs both ways.
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I felt this way even before UNI rewards came along (and this has been empirically true for many top pairs, in particular ETH/DAI). I LP because I have strong conviction that I'm going to make money. UNI rewards just sweeten the pot.
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