A unified liquidity layer is a foundational infrastructure that aggregates liquidity from multiple sources across various decentralized exchanges, lending protocols, and blockchain networks into a single, accessible pool. This aggregation allows users and applications to access deeper liquidity and achieve better execution prices for trades and other financial operations. It addresses market fragmentation by creating a more efficient capital environment. Such a layer enhances market efficiency and reduces slippage.
Context
The pursuit of a unified liquidity layer is a major objective within decentralized finance to overcome the challenges of fragmented markets. Discussions often center on the technical complexities of cross-chain aggregation and the security implications of combining liquidity from diverse protocols. News frequently reports on new initiatives and protocols aiming to build such a layer, indicating efforts to improve capital efficiency and market depth in the digital asset space.
The Clovis hub-and-spoke architecture abstracts multi-chain complexity, creating a single, unified capital layer for lending and swaps to maximize DeFi efficiency.
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