1inch Launches Aqua Protocol, Enabling Shared Liquidity Across 13 Chains

1inch debuts Aqua, allowing users to provide liquidity via wallet balances without depositing assets. The protocol supports 13 EVM chains, aiming to solve idle capital and custody risks in DeFi.

Woofun AI reports that decentralized exchange aggregator 1inch has officially launched the shared liquidity protocol Aqua for all users. Previously opened to developers last November, Aqua now supports 13 EVM-compatible chains, including Ethereum, Arbitrum, Base, Robinhood Chain, and BNB Chain. The protocol enables users to support multiple liquidity positions simultaneously using only their token balances, eliminating the need to deposit assets into liquidity pools.

Assets remain in the user's wallet, and tokens are called via a single atomic transaction only when a trade is executed, with received tokens and fees returned to the wallet. 1inch stated that this "shared liquidity" model addresses issues such as long-term idle liquidity, low capital utilization, and asset custody risks. The company noted that traditional models often leave liquidity inactive in specific price ranges, failing to generate fees while exposing providers to volatility.

Additionally, splitting funds across protocols reduces efficiency, and depositing assets relinquishes custody rights, increasing exposure to risks like JIT liquidity bots seizing fees. Aqua enhances capital efficiency by registering wallet balances as a shared source, allowing the same asset to support multiple positions without transferring ownership. If a wallet balance is insufficient to cover a trade, the protocol will not execute it, ensuring user risk remains limited to actual holdings.