Market Making in DEX: Why This Often-Overlooked Mechanism Matters So Much

Liquidity provision on decentralized exchanges isn't just a supporting role—it's the backbone that determines whether trading flows smoothly or stalls completely.

Think about it: without market makers stepping in to provide liquidity, price discovery becomes difficult, slippage skyrockets, and most traders simply won't touch the platform. The entire DeFi trading layer collapses without this critical function working behind the scenes.

Yet here's the puzzle. Market making sits at the heart of DeFi infrastructure, handling billions in daily volume across countless trading pairs. It's arguably the most underrated layer in the entire ecosystem. Most people obsess over token launches, yield farming returns, or governance mechanics—but they gloss right past the unsexy but absolutely essential work that market makers do every single day.

The reality? No liquidity pools, no DeFi. It's that straightforward.