PANews November 20 news, the Bank for International Settlements (BIS) research report shows that although decentralized exchanges (DEXs) like Uniswap aim to eliminate intermediaries, liquidity provision (LP) is still dominated by a small number of skilled participants, similar to professional intermediaries in traditional finance. These 'professional' LPs account for 65-85% of the liquidity and earn higher returns, with an average daily net profit of 3 basis points (approximately annualized 11.65%) more than ordinary LPs. In contrast, retail LPs account for 93% of the number but provide less than 35% of the liquidity, with an average position size of only $29,000, while professional LPs have an average position size of $3.7 million.
Furthermore, Uniswap V3's 'concentrated liquidity' model accelerates the dominance of professional participants, who almost completely control liquidity in high liquidity pools with trading volumes exceeding $10 million, while retail participants are more concentrated in low liquidity pools with daily trading volumes of less than $100,000. This indicates that despite DEXs being initially intended for 'democratization', the market still shows a significant trend of centralization.
