Paper 2023/1898
An Empirical Study of Cross-chain Arbitrage in Decentralized Exchanges
Abstract
Blockchain interoperability refers to the ability of blockchains to share information with each other. Decentralized Exchanges (DEXs) are peer-to-peer marketplaces where traders can exchange cryptocurrencies. Several studies have focused on arbitrage analysis within a single blockchain, typically in Ethereum. Recently, we have seen a growing interest in cross-chain technologies to create a more interconnected blockchain network. We present a framework to study cross-chain arbitrage in DEXs. We use this framework to analyze cross-chain arbitrages between two popular DEXs, PancakeSwap and QuickSwap, within a time frame of a month. While PancakeSwap is implemented on a blockchain named BNB Chain, QuickSwap is implemented on a different blockchain named Polygon. The approach of this work is to study the cross-chain arbitrage through an empirical study. We refer to the number of arbitrages, their revenue as well as to their duration. This work lays the basis for understanding cross-chain arbitrage and its potential impact on the blockchain technology.
Metadata
- Available format(s)
-
PDF
- Category
- Applications
- Publication info
- Published elsewhere. Minor revision. International Conference on Communication Systems and Networks (COMSNETS) 2024
- Keywords
- BlockchainDecentralized ExchangesDeFiArbitrage
- Contact author(s)
-
orimazor @ campus technion ac il
or @ technion ac il - History
- 2023-12-11: approved
- 2023-12-10: received
- See all versions
- Short URL
- https://ia.cr/2023/1898
- License
-
CC BY
BibTeX
@misc{cryptoeprint:2023/1898,
author = {Ori Mazor and Ori Rottenstreich},
title = {An Empirical Study of Cross-chain Arbitrage in Decentralized Exchanges},
howpublished = {Cryptology {ePrint} Archive, Paper 2023/1898},
year = {2023},
url = {https://eprint.iacr.org/2023/1898}
}
