1inch Unveils Aqua, a New Shared-Liquidity Protocol Aiming to Reshape DeFi Capital Efficiency

Decentralized-exchange aggregator, 1inch, has rolled out Aqua, a new liquidity protocol designed to change how capital moves within decentralized finance. The project introduces a model that allows multiple DeFi strategies to draw from the same wallet without requiring users to lock away their funds. 

The announcement was made during Devconnect in Argentina, with the team positioning Aqua as an essential step toward addressing persistent liquidity fragmentation in the ecosystem.

Developers now have early access to Aqua’s software development kit, libraries, and documentation on GitHub. A complete front-end interface is expected in early 2026, giving builders several months to experiment with the new system. 

According to 1inch, Aqua is intended to function as the first shared-liquidity engine in DeFi, built to help applications draw from a unified capital layer rather than competing for user deposits.

Co-founder, Anton Bukov, described the launch as a major milestone. “Aqua solves liquidity fragmentation for market makers by multiplying effective capital. From now on, the only limit to your capital efficiency is your strategy,” he said. “It’s time to help liquidity providers unleash their potential.”

The team believes this architecture will allow users to participate in multiple positions, such as automated market makers, stable swap pools, or lending platforms, while assets remain safely in their own wallets. With the developer preview now live, 1inch is encouraging the community to build and test new approaches ahead of the full release.

Aqua’s Shared Liquidity Layer and the Push to Reduce Fragmentation

Aqua introduces a model that 1inch describes as a “shared liquidity layer,” a system meant to let DeFi strategies pull from a single capital base instead of dividing assets across multiple smart contracts. Traditionally, users select one strategy at a time, depositing tokens into a particular pool or protocol. This setup forces liquidity providers to weigh opportunity costs and restricts how much utility they can gain from their holdings.

Aqua’s design reverses that. Rather than forcing users to lock tokens, the system allows funds to stay in the wallet. Strategies only draw from those assets at the moment a trade or action occurs. The protocol’s accounting layer tracks each strategy, its access permissions, and its usage limits. This means that a single wallet can simultaneously support several activities without handing over ownership.

Bukov reiterated this point when speaking about Aqua’s broader position in DeFi. “Aqua solves liquidity fragmentation by multiplying effective capital,” he said again during the unveiling. His co-founder, Sergej Kunz, added that the protocol is meant to serve as a foundation for efficient capital deployment across chains. Kunz called the launch “a pivotal moment for DeFi liquidity management, fundamentally changing how users interact with decentralized solutions.”

In practice, liquidity providers can authorize their tokens for multiple strategies at once. For example, they could support AMMs, interact with stable swap pools, or engage with custom-built strategies simultaneously. Each of these channels operates under its own set of rules. Because capital is not deposited into separate pools, users maintain custody and gain more flexibility in how they participate across DeFi.

The model could shift how capital efficiency and utility efficiency are measured. A single wallet can effectively provide more liquidity, while users gain the ability to vote in governance, participate in yield opportunities, or post collateral on lending platforms at the same time.

Developer Access, Early Experimentation, and 1inch’s Expanding Ecosystem

The preview available on GitHub gives builders a chance to experiment with Aqua months ahead of its full release. Developers can write strategies from scratch or use pre-built modules from SwapVM, a partner protocol that provides a library of instructions for assembling new trading or liquidity models. This early access is intended to encourage teams to innovate and help refine the system before it goes live to the wider public.

1inch is also offering bounties of up to $100,000 for contributions, bug discovery, and performance improvements. That incentive program signals the company’s interest in accelerating adoption, stress-testing the system, and attracting new developers to its ecosystem.

This launch arrives as 1inch continues to expand its broader product stack. Its aggregation engine remains one of the most used systems in DeFi, supporting low-cost token swaps for over 26 million users and processing more than $500 million in daily trading volume. Beyond aggregation, 1inch offers a self-custodial wallet, portfolio tools, routing infrastructure for businesses, and multi-chain integrations across both EVM and non-EVM networks.

Aqua follows several major updates from earlier this year. Coinbase tapped 1inch’s API to improve swap execution for retail users on its main app. The project also introduced native cross-chain swaps between Solana and EVM networks, aiming to reduce the friction that often accompanies multi-chain activity. Before that, 1inch shipped a new version of its Pathfinder routing algorithm to generate better swap quotes across hundreds of liquidity sources.

These moves have helped position 1inch as the second-largest DEX aggregator on Ethereum, based on market share data tracked by The Block. Aqua’s arrival adds another layer to the company’s efforts to improve liquidity across protocols without forcing users to compromise on custody or flexibility.

Industry Context, Early Reactions, and Wider Market Developments

Aqua’s introduction comes at a moment when shared-liquidity models are gaining attention within DeFi. Earlier attempts, such as Balancer’s Liquidity Bootstrapping Pools, explored ways to distribute capital more efficiently. Aqua builds on those ideas but focuses on enabling simultaneous usage across strategies without requiring deposits.

According to Coincu analysts, this approach could reshape how liquidity is managed, shifting technological and financial advantages toward protocols that adopt shared-liquidity frameworks quickly. The report suggests that long-term uptake may produce more diverse and robust liquidity distribution.

Japan’s Financial Services Agency also entered the global policy conversation this week with a proposal to classify cryptocurrencies as “financial products” under the Financial Instruments and Exchange Act. A local publication reported that the change would place strict disclosure requirements on the 105 digital assets listed on Japanese exchanges and, for the first time, apply insider-trading rules to major cryptocurrencies like Bitcoin and Ethereum. The proposal is slated for parliamentary review in 2026.

As part of the same reform, the FSA is pushing to replace its current tax model. Crypto gains are presently taxed as “miscellaneous income,” a category that can reach as high as 55 percent. Under the proposed plan, digital asset gains would instead be taxed at a flat 20 percent rate, similar to how stock profits are treated. The agency hopes the change will reduce the tax burden on traders and create a more consistent regulatory environment.

Market activity also reflects increasing attention to liquidity developments. Ethereum is currently priced at $3,199.32, with a market capitalization of $386.14 billion and dominance of 11.90 percent, according to CoinMarketCap. Trading volume climbed 68.27 percent over the past 24 hours, even as the asset experienced recent price declines.

As 1inch prepares Aqua for its wider release next year, the protocol is expected to remain a focal point for both developers and liquidity providers interested in achieving more with their capital. With its early access phase now open, the system sets the stage for ongoing experimentation across the DeFi space.