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hayden.eth šŸ¦„
@haydenzadams
Great thread! High margin professional tradfi market makers are the definition of the entrenched and extractive middlemen defi promises to replace and democratize. I love watching it happen in real time šŸ’œ
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Cyrus Younessi
@cyounessi1
Super interesting technical discussions on both sides of the AMM debate tonight(@SBF_Alameda and @KyleSamani vs @danrobinson). 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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hayden.eth šŸ¦„
@haydenzadams
Reminds me of a convo w/
@scott_lew_is
in the early days of Uniswap where we discussed professional market makers getting outcompeted by passive pooled LPs that would happily accept much lower margins :)
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Will Warren šŸµ
@willwarren
Replying to
@danrobinson
@SBF_Alameda
and 2 others
I don't think this is the right framing. Are you implying that AMM LPs are willing to accept a % fee that is so low that sophisticated MMs (and other competing AMMs) just won't bother participating in the market?
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Will Warren šŸµ
@willwarren
Replying to @srndptme and @cyounessi1
The following image demonstrates how sophisticated MMs can eat into AMM fees until it is no longer viable to overcome impermanent loss.
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Hayek ā³
@cryptoisback
Replying to
@willwarren
@willwarren89
and 5 others
iā€™m not familiar w pro mms, but is it possible that code itself eventually replaces what they do? e.g. code for strategy, code for timing, etc. my thinking is that the way LPs interact with AMMs will only become more complex/efficient and thus AMMs winning over order books
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