1inch research with Dune Analytics finds $1.6 billion in DeFi liquidity underutilized, signaling inefficiency as institutional capital moves onchain.
DeFi & Yields ·
Research conducted by 1inch and Dune Analytics identified $1.6 billion in underutilized decentralized exchange liquidity as institutions and tokenized assets move onto blockchain networks. The study examined concentrated liquidity positions across leading venues including Uniswap v3, PancakeSwap v3, Aerodrome Slipstream, and Uniswap v4, tracking roughly $1.84 billion in average weekly liquidity across seven chains during the first half of 2026.
The analysis revealed persistent capital inefficiency despite concentrated liquidity's design to improve capital deployment. Over 26 weeks, a TVL-weighted mean of 29.5% of capital sat outside active trading ranges and generated no fees, averaging $542 million idle per week. The v3-family breakdown showed only 13.7% actively used, with 56.9% in range but untouched and 29.4% out of range; constant-product venues fared worse at 98.7% underutilized. Larger positions held the bulk of idle capital, with over $200 million remaining untouched for more than 90 days. Individually held positions on Uniswap v3 accounted for most out-of-range capital, while automated managers maintained better ranges. Liquidity providers across the ecosystem forgo approximately $150 million annually in potential fees.
What remains unclear is whether concentrated liquidity improvements or protocol upgrades will substantially close this efficiency gap as onchain institutional adoption accelerates, or how the findings translate to emerging market conditions beyond the measured period.