In this episode I speak with Grug, an anonymous MEV searcher on the Ethereum blockchain.  If that sentence made no sense to you, I promise this will be a fun episode.
To begin the conversation, Grug explains the basic architecture of the Ethereum blockchain and how its structure allows for the emergence of MEV strategies like sandwich attacks, arbitrage, and liquidations.  
He discusses some of the criteria he looks for when identifying a profitable MEV strategy and provides examples of some of the long-tail approaches he has deployed in the past as well as some of the risks associated with them.  We discuss the pro-cyclical nature of some of these strategies, the role of retail flow, and the edge in being able to deploy rapidly.
Grug also provides his thoughts on the impact of alt-L1’s and L2’s on MEV, airdrop strategies, and the end game of MEV if Ethereum infrastructure becomes too centralized.
Please enjoy my conversation with Grug.

Grug Capital – Grug (Finally) Teaches Us MEV (S6E12)

My guest this episode is Jeff Yan, founder of Chameleon Trading.  
 Jeff began his career in high frequency trading at Hudson River Trading but soon moved over to the world of crypto where he built one of the largest market making firms in the space.
 After Jeff gets me up to speed with the basics of high frequency market making, we dive into some of the more esoteric components, particularly with respect to centralized crypto exchanges.  These include infrastructure quirks, adversarial algorithms, and why HFT P&L might actually be predictive of medium-term price movement.
 In the back half of the conversation, Jeff explains the problems he sees with current decentralized exchanges and introduces Hyperliquid, a new decentralized trading platform built on its own blockchain to provide performant order book execution for perpetual futures.
 Please enjoy my conversation with Jeff Yan.

Flirting with Models Transcript on Applepodcasts

Grug Capital – Grug (Finally) Teaches Us MEV (S6E12)

Jeff Yan - High Frequency Crypto Market Making & the Hyperliquid Exchange (S6E2)