---
title: Learning from DeFi: Would Automated Market Makers Improve Equity Trading?
url: https://www.ml-quant.com/papers/ssrn/4531670/
site: ML-Quant (https://www.ml-quant.com)
updated: 2026-09-26
license: Summaries CC BY 4.0; links go to the original sources
index: https://www.ml-quant.com/llms.txt
identifier: SSRN 4531670
source_url: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4531670
featured: 2023-08-09
citations: 17
topic: Crypto & DeFi
---


# Learning from DeFi: Would Automated Market Makers Improve Equity Trading?

The study suggests that optimally designed automated market makers could potentially save U.S. investors billions in transaction costs each year.

- Source: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4531670
- Identifier: SSRN 4531670
- Released: 2023-08-04
- First featured: Quant Letter No. 11 (2023-08-09): https://www.ml-quant.com/issues/2023-08-09/
- Citations (Semantic Scholar): 17
- Published in: not yet
- Topic: Crypto & DeFi

## Related

- [Axioms for Automated Market Makers: A Mathematical Framework in FinTech and Decentralized Finance](https://www.ml-quant.com/papers/arxiv/2210.01227/): Mathematical Framework: The research introduces a new framework for Automated Market Makers, suggesting a unique fee structure and a novel AMM that reduces divergence loss.
- [Decentralised Finance and Automated Market Making: Execution and Speculation](https://www.ml-quant.com/papers/ssrn/4144743/): The study investigates automated market makers, particularly constant product market makers, and develops two optimal trading strategies using stochastic optimal control tools, as demonstrated with Uniswap v3 data.
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- [A theoretical framework for fees in AMMs](https://www.ml-quant.com/papers/arxiv/2404.03976/): The study explores the workings of arbitrage in decentralized finance automated market makers (AMMs), aiming to understand how AMMs can optimize revenue or minimize losses, and models the dynamics of arbitrage activity.
- [Decentralised Finance and Market Making](https://www.ml-quant.com/papers/ssrn/4897143/): The study develops optimal strategies for large order traders and statistical arbitrages in automated market makers with concentrated liquidity.
- [DeFi Arbitrage](https://www.ml-quant.com/papers/ssrn/4959073/): A study proposes risk-neutral pricing and hedging formulas for liquidity tokens in the constant product market maker (CPMM), suggesting new Automated Market Maker (AMM) designs.
