Three trading firms that provide liquidity across major centralised venues have reduced the number of pairs they actively quote this year, according to executives at each firm and venue liquidity reports reviewed by this newsroom.
The reasons given are consistent: inventory in low-float tokens is difficult to hedge, and market-making agreements signed during the last listing boom priced risk more cheaply than firms would price it today.
The effect is visible in the books. On the pairs we sampled, depth within fifty basis points of mid has thinned even where headline volume is unchanged, because volume is increasingly concentrated in a handful of large-cap pairs.
Exchanges dispute the framing. Two venues said quoting obligations are being renegotiated rather than abandoned, and that new entrants have taken over some pairs.
For listed projects the practical consequence is price impact: the same sell order moves the market further than it did a year ago, regardless of what the token's daily volume figure suggests.
