Introduction

Fluid, developed by the Instadapp team, was launched October 29, 2024, and has since become a key player in the DeFi space. Fluid was designed for capital efficiency with features such as Smart Collateral and Smart Debt, allowing users to utilize their assets and liabilities as trading liquidity. This approach enables users to earn trading fees and offset borrowing costs while maximizing capital. Fluid focused on unifying lending and trading into one efficient system. At the heart of Fluid lies the Liquidity Layer, which addresses the issue of liquidity fragmentation by allowing new protocol versions to access existing liquidity without necessitating fresh capital inflow. The Lending Protocol serves as the ‘Deposit and Earn’ facet of Fluid, offering users a straightforward interface to supply assets and earn yields. It adopts the ERC-4626 standard for tokenized vaults to achieve interoperability across DeFi.

Key Takeaways

• Fluid has rapidly become a major DeFi player, reaching over $1B market size in just 9 months post-launch. It is now the 3rd largest DEX by volume on Ethereum and 6th Lending protocol by TVL, outperforming with only organic growth and minimal incentives.
• In Q1 2025, Fluid generated $18.3M in fees (+62.6%), with net earnings at $2M, without any incentives (over 1.5M $POL incentives were distributed for adoption as they launched on Polygon).
• Fluid’s TVL hit $900M and expanded to Polygon. Lending TVL is still concentrated on Ethereum, but daily active users and deposits on L2s are growing fast.
• With revenue nearing the $10M buyback trigger, future token buybacks could act as powerful price catalysts for a positive re-evaluation of $FLUID.
• Fluid processed over $26B in cumulative DEX volume on Ethereum in Q1, with the top pairs being USDC-WETH and USDC-USDT.