Pith Number

pith:R73VZHWH

pith:2026:R73VZHWHTFGFB7OZT56D4MHDRQ

not attested not anchored not stored refs resolved

The Viability of Blockchain Markets under Discrete Clearing and Paid Priority

Agostino Capponi, \'Alvaro Cartea, Fay\c{c}al Drissi

Blockchain markets with discrete clearing and paid priority undermine their own viability by selecting only high-valuation traders.

arxiv:2605.17425 v1 · 2026-05-17 · q-fin.GN · econ.GN · q-fin.EC · q-fin.TR

Open paper page JSON Open Graph Bundle Merged state Verified badge What is a Pith Number?

Add to your LaTeX paper

\usepackage{pith}
\pithnumber{R73VZHWHTFGFB7OZT56D4MHDRQ}

Prints a linked badge after your title and injects PDF metadata. Compiles on arXiv. Learn more · Embed verified badge

Record completeness

1 Bitcoin timestamp

2 Internet Archive

3 Author claim open · sign in to claim

4 Citations open

5 Replications open

✓ Portable graph bundle live · download bundle · merged state

The bundle contains the canonical record plus signed events. A mirror can host it anywhere and recompute the same current state with the deterministic merge algorithm.

Claims

C1strongest claim

We show that these features undermine the viability of markets. Paid-priority ordering induces endogenous selection, where only traders with sufficiently high valuations participate. The participation cutoff rises with competition, which intensifies with lower information costs or higher liquidity demand. This hinders price discovery and biases prices. It also impairs liquidity: the cutoff concentrates trading among aggressive traders and increases adverse selection that liquidity suppliers absorb in a single clearing round. Although longer block times enhance consensus security, they amplify these effects and can cause markets to shut down.

C2weakest assumption

The model premise that traders rationally compare their private valuations against the expected priority fees and information costs to decide participation, producing a rising cutoff as competition intensifies (abstract description of endogenous selection mechanism).

C3one line summary

Blockchain markets with discrete clearing and paid priority fees experience endogenous trader selection that biases prices, impairs liquidity, and risks market shutdown as competition rises.

References

62 extracted · 62 resolved · 0 Pith anchors

[1] Replicating market makers 2021

[2] Aoyagi, Jun, and Yuki Ito, 2021, Coexisting exchange platforms: Limit order books and automated market makers 2021

[3] Auer, Raphael, Jon Frost, Leonardo Gambacorta, Cyril Monnet, Tara Rice, and Hyun Song Shin, 2022, Central bank digital currencies: motives, economic implications, and the re- search frontier,Annual re 2022

[4] Baldauf, Markus, and Joshua Mollner, 2020, High-frequency trading and market perfor- mance,The Journal of Finance75, 1495–1526 2020

[5] Barbon, Andrea, and Angelo Ranaldo, 2021, On the quality of cryptocurrency markets: Centralized versus decentralized exchanges,arXiv preprint arXiv:2112.07386 2021

Formal links

2 machine-checked theorem links

Receipt and verification

First computed	2026-05-20T00:03:57.864635Z
Builder	pith-number-builder-2026-05-17-v1
Signature	Pith Ed25519 (`pith-v1-2026-05`) · public key
Schema	pith-number/v1.0

Canonical hash

8ff75c9ec7994c50fdd99f7c3e30e38c06db6b99eb458fcfadae2e62a5b28e06

Aliases

arxiv: 2605.17425 · arxiv_version: 2605.17425v1 · doi: 10.48550/arxiv.2605.17425 · pith_short_12: R73VZHWHTFGF · pith_short_16: R73VZHWHTFGFB7OZ · pith_short_8: R73VZHWH

Agent API

Resolver JSON Graph JSON Events JSON Schema Signing key

Verify this Pith Number yourself

curl -sH 'Accept: application/ld+json' https://pith.science/pith/R73VZHWHTFGFB7OZT56D4MHDRQ \
  | jq -c '.canonical_record' \
  | python3 -c "import sys,json,hashlib; b=json.dumps(json.loads(sys.stdin.read()), sort_keys=True, separators=(',',':'), ensure_ascii=False).encode(); print(hashlib.sha256(b).hexdigest())"
# expect: 8ff75c9ec7994c50fdd99f7c3e30e38c06db6b99eb458fcfadae2e62a5b28e06

Canonical record JSON

{
  "metadata": {
    "abstract_canon_sha256": "2ee803378544b07f3d5d4621321eed3edf8ce52c4fa47049c86bc8a5ad25a597",
    "cross_cats_sorted": [
      "econ.GN",
      "q-fin.EC",
      "q-fin.TR"
    ],
    "license": "http://creativecommons.org/licenses/by/4.0/",
    "primary_cat": "q-fin.GN",
    "submitted_at": "2026-05-17T12:39:46Z",
    "title_canon_sha256": "5f0d01ceb0a4bf4b4afa1110e0f894afca1b3ca74b37e21528c77f8f5c5151bb"
  },
  "schema_version": "1.0",
  "source": {
    "id": "2605.17425",
    "kind": "arxiv",
    "version": 1
  }
}