A Dune study commissioned by 1inch found that roughly 85% of concentrated liquidity on several major decentralized exchanges is not being used effectively. The research, cited by The Block, covered nearly 200 active pools across seven blockchains and examined 26 weekly snapshots. On average, it tracked about $1.84 billion in liquidity each week, with around $1.6 billion classified as inefficient.
The study looked at platforms including Uniswap v3, Uniswap v4, PancakeSwap v3 and Aerodrome Slipstream. Among the findings, Uniswap v3 had the highest share of liquidity that had moved outside the market-making price range and then remained untouched for more than 90 days, at 44.5%. Aerodrome showed a lower figure of about 20%, while 58% of its idle capital had still been adjusted within the past 30 days.
The data also showed that only about 35% of idle capital was positioned within 5% of the market price. Around 43% was more than 25% away, and 17% was more than 100% away. By position size, allocations above $1 million accounted for about 47% of idle funds, equal to roughly $260 million.
According to The Block, a Dune study commissioned by 1inch found that about 85% of concentrated liquidity on decentralized exchanges including Uniswap v3, Uniswap v4, PancakeSwap v3 and Aerodrome Slipstream was not being used effectively.
The research examined 26 weekly snapshots of nearly 200 active pools across seven blockchains. On average, it tracked about $1.84 billion in liquidity per week, with roughly $1.6 billion categorized as inefficient.
Platform-level differences
On Uniswap v3, 44.5% of liquidity that had already moved outside the market-making price range had not been adjusted for more than 90 days, the highest share among the platforms covered in the study.
By comparison, Aerodrome posted a figure of about 20%. The study also found that 58% of idle capital on Aerodrome had still been adjusted within the past 30 days.
How far idle funds sit from market prices
Only about 35% of idle funds were positioned within 5% of the market price, the study said. Around 43% were more than 25% away from market levels, and another 17% were more than 100% away.
By capital size, positions worth more than $1 million accounted for about 47% of idle funds, or roughly $260 million.
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