Liquidity alone won't save you if your risk engine is trash.
TradFi learned this the hard way over decades. CeFi and DeFi? Still getting rekt by the same lesson.
Deep liquidity attracts size. Size attracts volatility. Volatility exposes weak risk management. Then liquidation cascades, oracle failures, and protocol exploits follow.
You can have billions in TVL but if your system can't handle a 30% swing in 10 minutes, you're just a honeypot waiting to get drained.
Real moats = liquidity + bulletproof risk systems. Everything else is just exit liquidity for smarter money.
TradFi learned this the hard way over decades. CeFi and DeFi? Still getting rekt by the same lesson.
Deep liquidity attracts size. Size attracts volatility. Volatility exposes weak risk management. Then liquidation cascades, oracle failures, and protocol exploits follow.
You can have billions in TVL but if your system can't handle a 30% swing in 10 minutes, you're just a honeypot waiting to get drained.
Real moats = liquidity + bulletproof risk systems. Everything else is just exit liquidity for smarter money.