A study by Dune, commissioned by 1inch, has revealed that 85% of concentrated liquidity on decentralized exchanges is underutilized, resulting in an annual loss of $150 million in fees. The research, which analyzed liquidity positions across top pools on platforms like Uniswap and PancakeSwap, found that approximately $542 million in liquidity per week is outside its fee range. Over one-third of this idle capital has been unused for more than 90 days.
The study reconstructed liquidity positions from the top 200 most active pools on Uniswap v3, Uniswap v4, PancakeSwap v3, and Aerodrome Slipstream, using data from January 6 to June 30. On average, $1.84 billion in liquidity was assessed weekly, with $1.6 billion being underutilized at any given time, highlighting significant inefficiencies in DeFi liquidity management.
Dune Research Reveals $150 Million Annual Fee Loss in DeFi Due to Underutilized Liquidity
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