TL;DR:
- Dune’s study analyzed nearly 200 of the most active pools on protocols like Uniswap v3, Uniswap v4, PancakeSwap v3, and Aerodrome Slipstream.
- A weekly average of $1.6 billion in capital remained underutilized out of a total of $1.84 billion evaluated.
- 36.7% of the inactive out-of-range capital has not recorded any type of adjustment or movement in more than 90 days.
The decentralized finance (DeFi) ecosystem faces structural challenges in optimizing its resources. According to the latest report by Dune, commissioned by 1inch, approximately 85% of concentrated liquidity on DEXs remains inactive and does not perform the function for which it was deposited by liquidity providers (LPs).
1/ Across H1 2026, an average of 85% of concentrated-liquidity capital was underutilized and 29.5% sat outside the active price range. That works out to roughly $542M idle in a typical week.
New onchain research from Dune, produced for @1inch. pic.twitter.com/VeI5SqEuWd
— Dune (@Dune) July 16, 2026
The research was based on rebuilding liquidity positions in the top 200 pools by activity within networks under advanced market-making models. Data collection covered 26 weekly snapshots taken between January 6 and June 30, spanning an average of $1.84 billion in liquidity per week across seven different blockchains.
The concept of concentrated liquidity allows users to set a specific price range to deploy their capital, rather than distributing it evenly. Dune’s data suggests that 29.5% of the monitored capital was strictly out of range in an average week, totaling nearly $542 million in stagnant funds. This state implies that the market price either exceeded or fell below the limits set by the user, canceling out fee generation.
The report argues that being in range does not equate to working efficiently either. When breaking down the metrics under the methodology of 1inch’s Aqua whitepaper, the firm discovered that capital in v3-type architectures splits into 13.7% active use, 56.9% that remains in range but records no weekly trades, and 29.4% out of range.
Institutional and Retail Capital Behavior
Regarding the permanence of funds, the study points out that a third of the idle money has not moved in 90 days. Specifically, 36.7% of out-of-range positions exceeded this period without modifications, which equates to about $200 million temporarily abandoned.
On the other hand, fund inactivity varies considerably depending on the size of the financial position. Dune’s report highlights that the percentage of idle capital decreases as the deposit volume increases, dropping from 53% in positions under $1,000 to 26% in those exceeding $1 million.
Even though smaller positions drift out of range more frequently, the bulk of the money comes from large investors. Wallets with more than $1 million concentrate 47% of all underutilized capital, representing nearly $260 million in a stagnant condition. In terms of ownership, individual wallets control 91% of the capital in Uniswap v3 on Ethereum and are responsible for 94 cents of every idle dollar.
Financial Impact and Technological Innovation
Technological upgrades do not solve the inefficiency of automated flows. Official data indicates that the main Uniswap v4 pools held about $230 million at the end of June, keeping 30.5% of their capacity out of range, a figure almost identical to its predecessor version.
With the Hooks v4 programming tools, custom code can be attached to redirect inactive tokens toward lending markets like Aave or Morpho. However, the report clarifies that none of the analyzed pools using this technology currently execute these types of operational functions.
According to Dune’s estimates, each dollar in range within Uniswap and PancakeSwap generated an annualized yield of about 35 cents in fees during the evaluated semester. The firm’s theoretical projection points out that the opportunity cost for individual liquidity providers amounts to about $150 million a year in uncollected fees due to a lack of rebalancing.
The planned launch of the Aqua shared liquidity product by 1inch is presented as the next milestone aimed at mitigating these capital inefficiencies in the DeFi environment.
