1inch Launches Aqua to Challenge DeFi's Traditional Liquidity Pool Model

By Lidia Yadlos

1inch is taking aim at one of DeFi's oldest building blocks: the liquidity pool.

The protocol has launched Aqua, a shared liquidity layer that allows users to provide liquidity directly from their wallets instead of depositing assets into pools. Live across 13 EVM blockchains, including Ethereum, Arbitrum, Base, Robinhood Chain and BNB Chain, Aqua is designed to improve capital efficiency while giving providers full control of their funds until the moment a trade executes.

To support the rollout, 1inch is also launching a liquidity incentive program funded with 10 million 1INCH from the 1inch Foundation and an additional 500,000 USDC from the 1inch DAO.

Rethinking DeFi's Liquidity Model

For years, decentralized exchanges have relied on liquidity pools, requiring providers to lock assets into smart contracts in exchange for trading fees.

According to 1inch, that model has become increasingly inefficient. Research conducted by Dune Analytics found that 85% of concentrated liquidity across major DEXs was underutilized during the first half of 2026. On average, $542 million sat outside active trading ranges each week, contributing to an estimated $150 million in unrealized annual trading fees.

Aqua replaces that model by allowing liquidity providers to quote directly from assets held in their own wallets. Instead of locking funds into pools, the protocol only accesses tokens when a trade matching the provider's conditions is executed, after which assets and fees are returned in a single atomic transaction.

Because the same wallet balance can support multiple liquidity positions simultaneously, providers can deploy capital more efficiently without giving up custody.

How Aqua Protects Users

To support the launch, Aqua has undergone eight independent security audits by OpenZeppelin, Bailsec, Hashlock, Hexens, MixBytes, Nethermind, Theori and Decurity. While users remain exposed to risks common across DeFi—including impermanent loss, market volatility and smart contract risk—1inch says Aqua is designed to improve capital efficiency without sacrificing self-custody.

For more than a decade, DeFi has measured success by how much liquidity is locked onchain. With Aqua, 1inch is betting the next stage of growth won't come from locking away more capital, but from making the capital already in the ecosystem significantly more productive.

If that vision gains traction, Aqua could reshape one of DeFi's oldest assumptions: that liquidity has to live inside a pool to power decentralized markets.

Published on Blockster

1inch Launches Aqua to Challenge DeFi's Traditional Liquidity Pool Model