This paper presents the results of a comprehensive empirical study of losses to arbitrageurs (following the formalization of loss-versus-rebalancing by [Milionis et al., 2022]) incurred by liquidity providers on automated market makers (AMMs). We show that those losses exceed the fees earned by liquidity providers across many of the largest AMM liquidity pools (on Uniswap). Remarkably, we also find that the Uniswap v2 pools are more profitable for passive LPs than their Uniswap v3 counterparts. We also investigate how arbitrage losses change with block times. As expected, arbitrage losses decrease when block production is faster. However, the rate of the decline varies significantly across different trading pairs. For instance, when comparing 100ms block times to Ethereum's current 12-second block times, the decrease in losses to arbitrageurs ranges between 20% to 70%, depending on the specific trading pair.

翻译：本文基于[Milionis et al., 2022]对损失与再平衡差异的正式化定义，系统实证研究了自动化做市商（AMM）流动性提供者所承受的套利者损失。研究表明，在Uniswap上多个最大流动性池中，这些损失超过了流动性提供者获得的费用收入。值得注意的是，我们还发现对于被动流动性提供者而言，Uniswap v2池的盈利能力优于其Uniswap v3对应池。此外，我们探讨了套利损失如何随区块时间变化。正如预期，区块生成速度加快时套利损失减少。然而，不同交易对的损失下降速率存在显著差异。例如，当将100毫秒区块时间与以太坊当前12秒区块时间进行比较时，套利者损失的降幅因具体交易对不同而介于20%至70%之间。