DeFi’s $12B Liquidity Dilemma: Aqua Seeks to Transform Dormant Funds into Active Power
- DeFi faces $12B liquidity crisis with 95% capital idle due to blockchain fragmentation. - 1inch's Aqua protocol enables shared liquidity, turning wallets into self-custodial AMMs to boost capital efficiency. - Aqua's $100K bug bounties and SDK aim to refine infrastructure as DeFi borrowing hits $41B in Q3 2025. - Critics highlight DeFi's fragmentation barriers, but proponents see Aqua replicating 2019 aggregation success. - 1INCH token's $0.207 breakout could signal optimism about resolving the liquidity
Recent industry research reveals that decentralized finance (DeFi) is grappling with a $12 billion liquidity shortfall, with 95% of funds remaining unused due to fragmentation among various protocols and blockchains. This challenge has driven new developments, such as 1inch's introduction of Aqua—a shared liquidity protocol designed to transform capital deployment in DeFi. The platform's co-founder Anton Bukov
Launched in November 2025, Aqua provides developers with access to a unified liquidity layer through an early-access SDK, libraries, and guides
The necessity for such advancements is highlighted by the unprecedented leverage in DeFi.
Investors are monitoring the 1inch token (1INCH) as an indicator of sector sentiment.
While critics maintain that DeFi’s fragmented landscape still hinders widespread adoption, supporters such as 1inch co-founder Sergej Kunz argue
The sector’s current phase marks a pivotal moment: as leverage and borrowing hit new highs, solutions like Aqua seek to activate dormant capital. The future of DeFi may depend on whether shared liquidity frameworks can resolve the industry’s liquidity dilemma or if it will continue to struggle with underused assets.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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