Tokenomics DAO Study Group: How to Execute Large Market Orders in Crypto


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Dec 07 2022 48 mins   4

What is the most cost effective way to go about buying a large amount of tokens? Why is this important you may ask? Be it a protocol, exchange or humble whale; knowing how to execute large orders in decentralised finance can be difficult due to a multitude of different factors that have to be considered such as MEV, liquidity, different exchange models, slippage and price impact to name a few. During this Tokenomics DAO Study Group, Mason Fasco tries to shed some light on this topic. Enjoy!

Outline:

* Objective: to acquire large amount of token with lowest price impact

* How does TradFi do it (trading algos)?

* How do we dot it in crypto (CLOB vs AMMs and their respective problems)?

* Onchain methods (TWAMM & Concentrated Liquidity)

* Other solutions to investigate (Inverse Bonds & rLBPs)

Resources:

* Algorithmic trading definition: https://en.wikipedia.org/wiki/Algorithmic_trading

* What is MEV: https://getblock.io/blog/what-is-mev-miner-extractable-value-mev-explained/

* Front Running and Sandwich Attack Explained: https://quillaudits.medium.com/front-running-and-sandwich-attack-explained-quillaudits-de1e8ff3356d

* Backrunning in DeFI: https://medium.com/@m.vanderwijden1/backrunning-in-defi-301f3cade30a

* Sandwich MEV: https://eigenphi-1.gitbook.io/classroom/mev-types/sandwich-mev

* TWAMM: https://www.paradigm.xyz/2021/07/twamm

* Concentrated Liquidity in Uniswap 3: https://www.paradigm.xyz/2021/07/twamm

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Disclaimer:

Not financial or tax advice. This channel is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. This video is not tax advice. Talk to your accountant. Do your own research.

None of this is legal advice. This podcast is strictly educational. Talk to your lawyer.

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