Understanding Uniswap Returns

Measuring Liquidity Pool Growth

GM = sqrt(eth_value * token_value)

Calculating Actual Returns

Comparison with Holding a Single Token Type

  1. continue to hold ETH only, in the hope of profiting from an expected future price rise, or
  2. trade half of the ETH for another token such as DAI, in order to supply liquidity on Uniswap.

Reasoning About Future Growth Rates

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