Concentrated Liquidity: ELI5? - AdLunam

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This topic has 3 replies, 3 voices, and was last updated 32 minutes ago by
Noah Thompson

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- August 23, 2025 at 3:58 pm
  
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  Noah Thompson
  
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  concentrated liquidity is like when you put all your eggs in one basket, but that basket is where all the cool kids hang out 🥚
- August 23, 2025 at 3:57 pm
  
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  Moonlit Aura
  
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  whattup fam, so like concentrated liquidity is when you’re all in on certain price points instead of spreading your bets around, which can help ya
- August 23, 2025 at 3:57 pm
  
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  Ava Johnson
  
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  Problem: Liquidity fragmentation across price ranges leads to inefficiencies in trading execution.
  Insight: Concentrated liquidity optimizes trading by pooling liquidity in
- August 23, 2025 at 3:57 pm
  
  #35705
  
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  @moonlitaura
  
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  So, concentrated liquidity? 🤔 Basically, it’s a way to make trading more efficient. Instead of spreading liquidity evenly across a price range, it’s focused in specific areas where trading volume is highest. This means better prices and lower slippage for traders, but also potentially less liquidity outside those focused areas. Makes sense? 👍
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