[draft] "Impermanent loss" of FLI?
kyoronut | きょろナッツ
4 years ago
In ideal rebalancing case, ETH2x-FLI is thought as an extension of an asymmetric AMM, which is well formalized by Balancer team, with weight of ETH and USDC are 2 and -1, respectively.
Impermanent loss of an asymmetric AMM is also formalized by Balancer team. In 2 assets case, it can be written as:
where is price ratio and is weight of an asset (sum of weights should be 1).
Let's consider case:
This is positive when r > 1/2.
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kyoronut | きょろナッツ
4 years ago
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