Paid Partnership: How Can DeFi Fix Its Liquidity Problem? 1inch's Aqua Offers a Solution

Aqua, a newly launched shared liquidity protocol for DeFi, addresses the systemic issue of capital fragmentation and underutilization by allowing users to maintain self-custody of their assets while participating in multiple trading strategies simultaneously. By shifting from traditional pool-based models to an intent-based framework, the protocol enables liquidity providers to retain control of their funds in their own wallets, facilitating participation in governance and complex strategies like looping on Aave. Research indicates that 85% of concentrated liquidity remains idle in standard AMMs; Aqua mitigates this by allowing assets to be utilized across various positions without the need for manual distribution. Professional market makers, vetted through 1inch’s compliance and KYB processes, handle settlement, providing a secure environment for both retail and institutional participants to optimize capital efficiency across 13 networks.