Awesome
protocol-reading-list
This is a list of resources intended to serve as a starting point for anybody interested in understanding how crypto protocols work under the hood.
Relevant topics include economics, finance, optimization, game theory, theoretical CS, cryptography.
Getting Started
- MEV 101 by @0xmebius
- DeFi and the Future of Finance from Ashwin Ramchandran and Joey Santoro
- DeFi MOOC (Fall 2021) from Dan Boneh Arthur Gervais, Andrew Miller, Christine Parlour, Dawn Song
- Special Topics in DeFi from Dawn Song
Slides and videos are available online for both.
References
- Algorithmic Game Theory from Tim Roughgarden
- Linear Dynamical Systems
- Convex Optimization by Stephen Boyd
- A Graduate Course in Applied Cryptography from Dan Boneh and Victor Shoup
For anybody coming in without a finance background, it's worth doing some tradfi reading before you dive deep into defi.
- Investopedia is a good reference
- Market making overview
A good intuitive introduction is Mathematics of Finance from Don Saari, followed by Arbitrage Theory in Continuous Time by Tomas Björk for more depth.
Constant Function Market Makers (CFMMs)
Trading via decentralized exchanges (DEXes) and automated market makers (AMMs).
Uniswap
V2
Also:
- Uniswap: A Good Deal for Liquidity Providers? (medium.com)
- Understanding Uniswap Returns (medium.com)
- On AMMS (vitalik.ca)
- Background on market making (PDF)
V3
- Introducing Uniswap V3 (uniswap.org/blog)
- What is Uniswap - V3 (docs.uniswap.org)
- Uniswap V3: The Universal AMM (paradigm.xyz)
- Uniswap V3 Whitepaper (PDF)
- Interactive graphs in Desmos for Uniswap V3 from @danrobinson
Also:
- Liquidity Mining on Uniswap v3 (paradigm.xyz)
- Toxic Flow: Its Sources and Counter-Strategies (deribit.com)
- Flash Boys 2.0 (PDF)
Curve
- Curve StableSwap Whitepaper (PDF)
- Curve Crypto Pools Whitepaper (PDF)
- Curve DAO Whitepapers (PDF)
- Understanding StableSwap (Curve)
- Curve Wars (every.to) from @nateliason
Alternative Designs
- Nested AMMs (dropbox.com) from Anthony Lee Zhang
- TWAMM (paradigm.xyz)
- Mooniswap Whitepaper (PDF)
- dYdX Whitepaper (PDF)
- Crocswap Whitepaper
- Cowswap
- Lifinity
CFMM Analysis
Work from @GuilleAngeris, @tarunchitra, @alexhevans and more
- An analysis of Uniswap markets (PDF)
- Multi-asset trades via convex optimization (PDF)
- Improved Price Oracles: Constant Function Market Makers (PDF)
- Liquidity Provider Returns in Geometric Mean Markets
- Optimal Fees for Geometric Mean Market Makers (PDF)
- Optimal Routing for Constant Function Market Makers (PDF)
- When does the tail wag the dog? Curvature and market making (PDF)
Privacy-preserving CFMMs
- A Note on Privacy in Constant Function Market Makers (PDF)
- Differential Privacy in Constant Function Market Makers (PDF)
Options
- Virtual AMM (vAMM): Perpetual Protocol
- Drift Dynamic AMM
- Replicating Market Makers
- Replicating Monotonic Payoffs Without Oracles
- Primitive Finance
- Why Stake When You Can Borrow?
- Uniswap V3 LP Tokens as Perpetual Put and Call Options from Guillaume Lambert
For more detail, check out 0xperp/defi-derivatives.
LPing on Uniswap V3
- Strategic Liquidity Provision in Uniswap v3 (PDF)
- Charm’s Alpha Vault, the Minimalist Uniswap v3 LP Strategy (PDF)
- Impermanent Loss in Uniswap v3 (PDF)
More resources at GammaStrategies/awesome-uniswap-v3.
Protocol Owned Liquidity (POL)
Read these:
- Introducing OlympusDAO, An Algorithmic Currency Protocol (medium.com)
- FAQ（docs.olympusdao.finance)
- A Beginner’s Guide to Navigating Olympus Pro (medium.com)
- A Primer on Bonding (medium.com)
Then read these:
- Feedback Control as a New Primitive for DeFi (medium.com/gauntlet-networks)
- DeFi liquidity management via Optimal Control: Ohm as a case study (PDF)
Asset Management
Balancer
- Balancer Basics
- Balancer Whitepaper (PDF)
- Calculating Value, Impermanent Loss and Slippage for Balancer Pools (medium.com)
- Capital-Efficient AMMs With Dynamically Adjusted Weights In Balancer V2 (medium.com)
Lending
Decentralized banks.
Stablecoins
Ramps
<!-- stripe crypto -->Miscellaneous
- Gauntlet Protocol Assessment Reports
- Gauntlet Blog (medium.com)
- A list of open problems in DeFi by 0xemperor
- 0xalpharush/awesome-MEV-resources
- Chi Gastoken (blog.1inch.io)
- Flexible Anonymous Transactions: Flax (PDF)
ZK
Applied ZK falls into two main categories: ZK-enabled applications and ZK used at the infrastructure/L1 level.
Start with these:
Then dive deeper with these:
- Proofs, Arguments, and Zero-Knowledge from Justin Thaler
- https://people.eecs.berkeley.edu/~alexch/#teaching
- matter-labs/awesome-zero-knowledge-proofs
And check out these ZK-enabled hacks:
For more background on cryptography:
- Coding and Number Theory (PDF)
- A Computational Introduction to Number Theory and Algebra (PDF) from Victor Shoup
- Abstract algebra notes from Ben Lynn
- Learning with errors post-quantum (youtube.com)
- Pairings (youtube.com) from Dan Boneh
- Pairings (vitalik.ca)
For more details on ZK enabling L1 infrastructure:
I want to point out some papers from Aleo (a ZK-enabled, privacy-first L1):
- Zexe: Enabling Decentralized Private Computation
- LEO: A Programming Language for Formally Verified, Zero-Knowledge Applications
- Proof of Necessary Work: Succinct State Verification with Fairness Guarantees
And also this analysis: