The host, Professor Adam Belay, writes: Hi All, During our graduate-level Operating Systems seminar (6.581), we will have a guest lecture from Geoff Ramseyer of Stanford University on a new, highly scalable, decentralized exchange system called SPEEDEX. This talk will be open to MIT guests outside of the class, and the CSAIL community is welcome to attend.
Abstract: SPEEDEX is a decentralized exchange (DEX) that lets participants securely trade assets without giving any single party undue control over the market. SPEEDEX offers several advantages over prior DEXes. It achieves high throughput --- over 200,000 transactions per second on 48-core servers, even with tens of millions of open offers. SPEEDEX runs entirely within a Layer-1 blockchain, and thus achieves its scalability without fragmenting market liquidity between multiple blockchains or rollups. It eliminates internal arbitrage opportunities, so that a direct trade from asset A to B always receives as good a price as trading through some third asset, such as USD. Finally, it prevents certain front-running attacks that would otherwise increase the effective bid-ask spread for small traders.
SPEEDEX's key design insight is its use of an Arrow-Debreu exchange market structure that fixes the valuation of assets for all trades in a given block of transactions. We construct an algorithm, which is both asymptotically efficient and empirically practical, that computes these valuations while exactly preserving a DEX's financial correctness constraints. Not only does this market structure provide fairness across trades, but it also makes trade operations commutative and hence efficiently parallelizable. SPEEDEX is prototyped but not yet merged within one of the largest Layer-1 blockchains.
Geoff Ramseyer is a final year PhD student at Stanford University advised by David Mazières and Ashish Goel. He is interested broadly in market design and the interplay between market design and system performance. Recent projects include implementing SPEEDEX and a scalable CBDC ledger, with a focus on maximizing hardware parallelism.