Decentralized Finance (DeFi) – Research Reports

Decentralized Finance is a general term covering a variety of activities and business relationships. Six major DeFi service categoriesstablecoins, exchanges, credit, derivatives, insurance, and asset managementas well as auxiliary services such as wallets and oracles. While traditional finance relies on intermediaries to manage and process financial services, DeFi operates in a decentralized environment—public, permissionless blockchains. Services are generally encoded in open-source software protocols and smart contracts.

We have hand curated a list of Decentralized Finance Reports to Research Papers to here for a detailed understanding of DeFi. 

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Financial intermediation and risk in decentralized lending protocols
We provide an overview of decentralized protocols like Compound and Aave that offer collateralized loans for cryptoasset investors. Download
Decentralized Basic Income: Creating Wealth with On-Chain Staking and Fixed-Rate Protocols
In this review, we evaluate the mechanisms behind the decentralized finance protocols for generating stable, passive income. Download
Architecture of Automated Crypto-Finance Agent
We present the cognitive architecture of an autonomous agent for active portfolio management in decentralized finance, involving activities such as asset selection, portfolio balancing, liquidity provision, and trading. Download
Zero-knowledge Based Proof-chain — A methodology for blockchain-partial system
Intuitively there is a drastic distinction between the pure decentralized block-chain systems like Defis and those that only utilize block-chain as an enhancing technology but remain centralized with real-world business model and conventional technologies like database, application server, etc. Download
Training Massive Deep Neural Networks in a Smart Contract: A New Hope
Deep neural networks (DNNs) could be very useful in blockchain applications such as DeFi and NFT trading. Download
UNISWAP: Impermanent Loss and Risk Profile of a Liquidity Provider
Uniswap is a decentralized exchange (DEX) and was first launched on November 2, 2018 on the Ethereum mainnet [1] and is part of an Ecosystem of products in Decentralized Finance (DeFi). Download
Flash Crash for Cash: Cyber Threats in Decentralized Finance
Decentralized Finance (DeFi) took shape in 2020. Download
CeFi vs. DeFi — Comparing Centralized to Decentralized Finance
To non-experts, the traditional Centralized Finance (CeFi) ecosystem may seem obscure, because users are typically not aware of the underlying rules or agreements of financial assets and products. Download
An Empirical Study of DeFi Liquidations: Incentives, Risks, and Instabilities
Financial speculators often seek to increase their potential gains with leverage. Download
Maximizing Extractable Value from Automated Market Makers
Automated Market Makers (AMMs) are decentralized applications that allow users to exchange crypto-tokens without the need to find a matching exchange order. Download
SoK: Yield Aggregators in DeFi
Yield farming has been an immensely popular activity for cryptocurrency holders since the explosion of Decentralized Finance (DeFi) in the summer of 2020. Download
DeFiRanger: Detecting Price Manipulation Attacks on DeFi Applications
The rapid growth of Decentralized Finance (DeFi) boosts the Ethereum ecosystem. Download
From banks to DeFi: the evolution of the lending market
The Internet of Value (IOV) with its distributed ledger technology (DLT) underpinning has created new forms of lending markets. Download
The Homogenous Properties of Automated Market Makers
Automated market makers (AMM) have grown to obtain significant market share within the cryptocurrency ecosystem, resulting in a proliferation of new products pursuing exotic strategies for horizontal differentiation. Download
SoK: Decentralized Exchanges (DEX) with Automated Market Maker (AMM) protocols
As an integral part of the Decentralized Finance (DeFi) ecosystem, Automated Market Maker (AMM) based Decentralized Exchanges (DEXs) have gained massive traction with the revived interest in blockchain and distributed ledger technology in general. Download
BLOCKEYE: Hunting For DeFi Attacks on Blockchain
Decentralized finance, i.e., DeFi, has become the most popular type of application on many public blockchains (e.g., Ethereum) in recent years. Compared to the traditional finance, DeFi allows customers to flexibly participate in diverse blockchain financial services (e.g., lending, borrowing, collateral-izing, exchanging etc.) via smart contracts at a relatively low cost of trust. However, the open nature of DeFi inevitably introduces a large attack surface, which is a severe threat to the security of participants’ funds. Download
On the Just-In-Time Discovery of Profit-Generating Transactions in DeFi Protocols
In this paper, we investigate two methods that allow us to automatically create profitable DeFi trades, one well-suited to arbitrage and the other applicable to more complicated settings. Download
SciviK: A Versatile Framework for Specifying and Verifying Smart Contracts
The growing adoption of smart contracts on blockchains poses new security risks that can lead to significant monetary loss, while existing approaches either provide no (or partial) security guarantees for smart contracts or require huge proof effort. Download
Formal Analysis of Composable DeFi Protocols
Decentralized finance (DeFi) has become one of the most successful applications of blockchain and smart contracts. Download
Leveraged Trading on Blockchain Technology
We document an ongoing research process towards the implementation and integration of a digital artefact, executing the lifecycle of a leveraged trade with permissionless blockchain technology. Download
A theory of Automated Market Makers in DeFi
Automated market makers (AMMs) are one of the most prominent decentralized finance (DeFi) applications. Download
Frontrunner Jones and the Raiders of the Dark Forest: An Empirical Study of Frontrunning on the Ethereum Blockchain
Ethereum prospered the inception of a plethora of smart contract applications, ranging from gambling games to decentralized finance. Download
Measuring Asset Composability as a Proxy for DeFi Integration
Decentralized financial (DeFi) applications on the Ethereum blockchain are highly interoperable because they share a single state in a deterministic computational environment. Download
How Decentralized is the Governance of Blockchain-based Finance: Empirical Evidence from four Governance Token Distributions
Novel blockchain technology provides the infrastructure layer for the creation of decentralized appli-cations. Download
Flashot: A Snapshot of Flash Loan Attack on DeFi Ecosystem
Flash Loan attack can grab millions of dollars from decentralized vaults in one single transaction, drawing increasing attention from the Decentralized Finance (DeFi) players. Download
SoK: Decentralized Finance (DeFi)
Decentralized Finance (DeFi), a blockchain powered peer-to-peer financial system, is mushrooming. Download
DeFi-ning DeFi: Challenges & Pathway
The decentralized and trustless nature of cryptocurrencies and blockchain technology leads to a shift in the digital world. Download
Quantifying Blockchain Extractable Value: How dark is the forest?
Permissionless blockchains such as Bitcoin have excelled at financial services. Download
Dynamic Curves for Decentralized Autonomous Cryptocurrency Exchanges
One of the exciting recent developments in decentralized finance (DeFi) has been the development of decentralized cryptocurrency exchanges that can autonomously handle conversion between different cryptocurrencies. Download
SoK: Lending Pools in Decentralized Finance
Lending pools are decentralized applications which allow mutually untrusted users to lend and borrow crypto-assets. Download
Decentralized Finance, Centralized Ownership? An Iterative Mapping Process to Measure Protocol Token Distribution
In this paper, we analyze various Decentralized Finance (DeFi) protocols in terms of their token distributions. Download
Extracting Smart Contracts Tested and Verified in Coq
We implement extraction of Coq programs to functional languages based on MetaCoq’s certified erasure. Download
Exploring Narrative Economics: An Agent-Based-Modeling Platform that Integrates Automated Traders with Opinion Dynamics
In seeking to explain aspects of real-world economies that defy easy understanding when analysed via conventional means, Nobel Laureate Robert Shiller has since 2017 introduced and developed the idea of Narrative Economics, where observable economic factors such as the dynamics of prices in asset markets are explained largely as a consequence of the narratives. Download
Towards A First Step to Understand Flash Loan and Its Applications in DeFi Ecosystem
Flash Loan, as an emerging service in the decentralized finance ecosystem, allows users to request a non-collateral loan. Download
AMR – Autonomous Coin Mixer with Privacy Preserving Reward Distribution
It is well known that users on open blockchains are tracked by an industry providing services to governments, law enforcement, secret services, and alike. Download
Liquidations: DeFi on a Knife-edge
The trustless nature of permissionless blockchains renders overcollateralization a key safety component relied upon by decentralized finance (DeFi) protocols. Download
Optimal Bidding Strategy for Maker Auctions
The Maker Protocol is a decentralized finance application that enables collateralized lending. Download
Automated Market Makers for Decentralized Finance (DeFi)
This paper compares mathematical models for automated market makers including logarithmic market scoring rule (LMSR), liquidity sensitive LMSR (LS-LMSR), constant product/mean/sum, and others. Download
Decentralized Asset Custody Scheme with Security against Rational Adversary
Asset custody is a core financial service in which the custodian holds in-safekeeping assets on behalf of the client. Download
Stablecoins 2.0: Economic Foundations and Risk-based Models
Stablecoins are one of the most widely capitalized type of cryptocurrency. Download
Why Stake When You Can Borrow?
As smart contract platforms autonomously manage billions of dollars of capital, quantifying the portfolio risk that investors engender in these systems is increasingly important. Download
DeFi Protocols for Loanable Funds: Interest Rates, Liquidity and Market Efficiency
We coin the term Protocols for Loanable Funds (PLFs) to refer to protocols which establish distributed ledger-based markets for loanable funds. Download
A First Look into DeFi Oracles
Recently emerging Decentralized Finance (DeFi) takes the promise of cryptocurrencies a step further, leveraging their decentralized networks to transform traditional financial products into trustless and transparent protocols that run without intermediaries. Download
A Human Dimension of Hacking: Social Engineering through Social Media
Social engineering through social media channels targeting organizational employees is emerging as one of the most challenging information security threats. Download
Improved Price Oracles: Constant Function Market Makers
Automated market makers, first popularized by Hanson’s logarithmic market scoring rule (or LMSR) for prediction markets, have become important building blocks, called ‘primitives,’ for decentralized finance. Download
Attacking the DeFi Ecosystem with Flash Loans for Fun and Profit
Credit allows a lender to loan out surplus capital to a borrower. Download
The Decentralized Financial Crisis
The Global Financial Crisis of 2008, caused by the accumulation of excessive financial risk, inspired Satoshi Nakamoto to create Bitcoin. Download
Potential applications of Distributed Ledger Technology to the Defence Support Network
Proponents of Distributed Ledger Technology (DLT) claim it could have an impact greater than the internet; a breakthrough defying organisational boundaries by securely storing data across trustless entities. Download


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