Additionally, @reflexerfinance has an extremely low ASC despite being relatively robust. Thanks to @ameensol for his writing explaining Reflexer's internals, @wei3erHase for answering questions on how the protocol really works.
Excited announce The ASC (annual stability cost):
A heuristic for quantifying the annual cost imposed on users to keep a stablecoin stable.
In this paper, we look at five popular stablecoins (DAI, UST, USDe, RAI, USDC) and pass judgement!
https://t.co/rY1mqouOhT
Suppose we have a constant product AMM with $1 of liquidity in it and a swap fee of 0.
Block times are infinitesimal and tx costs are 0. Asset is GBM with daily volatility of sigma.
How much arbitrage volume do we expect this AMM to get in 1 day?
Measuring the total transaction volume, in this case, is equal to measuring the total variation of a Brownian
motion path. However, this is famously infinite, due to the fractal nature of Brownian motion.