Decentralized finance (DeFi) is a nascent field that recently gained a lot of media attention. DeFi refers to financial service applications that are operated on blockchain technologies such as Ethereum. Such financial service applications include lending and borrowing, leveraged trading, asset management, insurance, and many new products and services that come out every day. These applications are currently active, and more than $10 billion has been circulating in the DeFi ecosystem. Thus the market for DeFi is real.
In 2008, Satoshi Nakamato introduced Bitcoin, a peer to peer electronic cash system. Unlike traditional banking system, Bitcoin allows people to transfer their money without need to trust a third party. This goal was achieved using the data structure called blockchain. Since Bitcoin, the idea of blockchain has been widely used in several projects. Depending on requirements of a project, a blockchain was designed to have a certain level of security, privacy, speed and etc.
Blockchains are a new technology that are finding applications across several domains. Participant privacy in a blockchain is a major concern for this technology, and this project focuses on studying privacy attacks and defenses in several kinds of publicly deployed blockchains. Specifically, the project will focus on how a participant’s location in the network can be determined and how a participant’s transaction can be uncovered in the context of blockchain networks that provide privacy guarantees.
Over the recent years, cryptocurrencies have attracted tremendous amount of attention from both general public and professional investors as a new asset class. However, trading activities of cryptocurrencies are extremely fragmented and unregulated in most of countries around the world. The proposed research project aims to empirically study the microstructure of cryptocurrency exchanges in order to gain insight on what elements are needed to improve the market. In particular, the proposed research focuses on the potential role of smart order router (SOR).
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