Modeling a Decentralized Asset Market: An Introduction the Financial "Toy Room"
Abstract
In this paper, the authors describe a micro-founded simulation environment for decentralized trade in a financial asset. Within the philosophy of computer-simulated "artificial markets", this environment allows one to experiment in a modular fashion with (i) individual characterizations in terms of behaviors and learning, (ii) different architectural and institutional traits of the market, and (iii) time-embedding of events at the system and the individual level.