According to Odaily, a report by the Bank for International Settlements (BIS) reveals that experienced participants dominate the decentralized exchange (DEX) sector, akin to professional intermediaries in traditional finance. While retail investors make up 93% of DEX liquidity providers (LPs), a small number of larger participants contribute 65-85% of the liquidity on these platforms. These seasoned participants also lead in profitability, achieving an average daily net return rate that is three basis points higher, translating to an annual return 11.65% greater than that of retail LPs. The average position held by retail investors is $29,000, whereas professionals maintain an average position of $3.7 million.
The report further indicates that retail investors earn approximately 10-25% in fees and generally possess lower technical expertise. The study focuses on Uniswap V3, suggesting that its launch accelerated the shift towards experienced participants. At the time of its introduction, mature LPs accounted for 40-50% of trades, a figure that rose to 70-80% by the end of 2023. These mature LPs exhibit distinct patterns, targeting pools with daily trading volumes exceeding $10 million and maintaining complete control over these pools. In contrast, retail LPs provide liquidity to pools with daily trading volumes below $100,000. Additionally, mature LPs focus on trading pairs with lower volatility, which are considered less risky.
