The Blockchain Research Lab (BRL) is pleased to announce a partnership with Popsicle Finance to start a research project in the area of Decentralized Finance (DeFi). Popsicle Finance is a digital platform that focuses on Automated Market Making (AMM) and liquidity provision in DeFi markets. The project will manage liquidity across multiple blockchains in order to increase capital efficiency and automatically providing its users with the highest possible yield on the assets they wish to deploy to liquidity pools.
At the latest since the launch and rapid growth of the Compound token in June 2020, DeFi has developed into a considerable phenomenon that is characterized by fast-paced innovation. Decentralized exchanges (DEXes), such as Uniswap or SushiSwap, facilitate the automated exchange of tokens on the blockchain through smart contract protocols. As we have lined out in our book “Blockchain and the Digital Economy”, the use of decentralized networks and open source software in the context of financial processes can sustainably transform the financial sector and form the basis for efficient and trustworthy systems, processes and products.
DeFi is a particularly suitable area for economic research because of its inherent transparency: every transaction is conducted “on-chain” and can be tracked and used for analyses. Due to its novelty, the topic has just been taken up by academic research. Within the research project, the relevant DeFi ecosystem(s) will be mapped, market inefficiencies identified and possible yield optimization and hedging strategies will be analysed with the goal to make DeFi markets less risky and more efficient.
We want to address the current research gap with our well-founded scientific findings in order to contribute to the preparation of an appropriate and target-group specific basis for decision-making for social, economic and political actors. Therefore, we are regularly publishing our results for the benefit of society in the form of scientific papers and contributions to conferences and other media.
We look forward to collaborate with Popsicle Finance on this exciting research project!