Bank for International Settlements: The liquidity supply of DEX similar to Uniswap is

On November 20, the Bank for International Settlements released a work report that delved into DEX Uniswap v3. In this study, the bank began to investigate whether the liquidity supply of DEX truly realized the democratization of financial markets or imitated traditional markets and was dominated by a few large companies. The Bank for International Settlements found that apart from technical implementation, liquidity supply is not dispersed. Its research results show that retail liquidity providers do not perform as well as mature participants who dominate the liquidity market. The report pointed out: "These participants have locked in about 80% of total value and focus on liquidity pools with maximum trading volume and low volatility." Research has found that retail LP's share of transaction fees is lower, and investment returns are relatively lower. In addition, the Bank for International Settlements also pointed out that retail providers "lose money after risk adjustment". Although this paper only focuses on Uniswap, researchers believe Uniswap v3 is "not special", its research results may apply to other DEXes. They suggest future studies should examine roles of individual investors and institutional participants in various DeFi applications (such as lending).