How ~$30k in Liquidity Supported $4m in 30-Day Trading Volume

By Jamie McCormick, Co-CMO, Stabull Labs

The eleventh article in the 15 part “Deconstructing DeFi” Series.

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At the time of writing, one Stabull pool held approximately $31,000 in liquidity.

Over the preceding 30 days, that same pool supported around $4.05 million in trading volume.

For anyone used to judging decentralised exchanges by raw TVL alone, that ratio looks unusual. But it makes sense once you understand how liquidity is actually being used inside modern DeFi execution flows.

Why TVL and volume are often misunderstood

In much of DeFi, TVL is treated as a proxy for success.

Higher TVL is assumed to mean deeper liquidity, better execution, and more trading activity. In practice, TVL only tells you how much capital is sitting in a pool. It tells you very little about how often that capital is used.

A large pool with little interaction can generate minimal fees. A smaller pool that sits on active execution paths can generate meaningful volume again and again.

The pool we examined falls squarely into the second category.

Parked liquidity vs working liquidity

The key distinction is not size, but utilisation.

In the transactions we traced, this pool was rarely the destination. Instead, it functioned as:

• a stable execution leg 
• an FX-anchored pricing step 
• a reliable mid-path conversion 

Each time a trade passed through, only a small portion of the pool was used. But those interactions happened continuously.

Over the course of a month, those small, repeatable interactions added up to $1.85 million in total volume.

Where the yield actually comes from

A common question — especially from people newer to DeFi — is how platforms can offer yield on stablecoin deposits at all.

In many protocols, the answer is lending. Assets are deposited, lent out to borrowers, and interest is generated from repayment over time. That model can work, but it introduces credit risk, liquidation risk, and reliance on borrower solvency.

Stabull works differently.

Liquidity provision on Stabull is closer to a toll booth than a lending desk.

LPs are not lending assets to be repaid later. They are providing liquidity that sits directly on execution paths. Every time a transaction flows through a pool, a small toll is paid.

No repayment risk. No leverage. Yield comes directly from usage.

The maths in practice

Using the example we analysed:

• Pool TVL: ~$31,000 
• Trading volume (30 days): $4.05 million 
• Swap fee: 0.015% 
• LP share of fees: 70% 

Fees generated (30 days)

$4,050,000 × 0.015% = $607.50 in total swap fees

LPs receive 70% of this:

$604.50 × 70% = $425.25 paid to LPs over the 30-day period

These fees are paid in the output currency of each swap, meaning LPs earn yield directly in liquid stablecoin assets.

Annualised view (illustrative)

If this level of activity were sustained over a full year (an assumption, not a guarantee):

$194.25 × 12 = $2,331 in annualised LP fees

On ~$31,000 of TVL, that equates to:

~6.7% annualised return from swap fees alone

This figure:

• comes purely from transaction activity 
• does not rely on lending or leverage 
• is generated in liquid assets 

Actual returns vary with volume and TVL, but the example illustrates how usage translates into yield.

Why execution quality matters more than depth

Execution systems — bots, solvers, and aggregators — do not route trades based on pool size alone.

They care about:

• predictable pricing 
• low slippage for the trade size 
• reliability inside atomic execution 
• failure risk 

Because Stabull uses oracle-anchored pricing, execution through the pool remains stable even as external markets move. That makes it suitable for repeated use inside automated strategies.

As a result, the pool was selected again and again — not because it was the largest, but because it was dependable.

Fees accumulate quietly, but consistently

There was no single large trade responsible for most of the volume.

Instead, activity came from:

• frequent, smaller swaps 
• automated execution 
• non-UI flows 

Each interaction paid swap fees. Over time, those fees accumulated steadily.

This contrasts sharply with incentive-driven volume, which often arrives in bursts and disappears just as quickly.

Yield beyond swap fees

Swap fees are only one part of the picture.

In addition, LPs on Stabull may receive STABUL token rewards via the Liquidity Mining Program run through Merkl.

These incentives are separate from swap fees and can:

• supplement organic yield 
• attract additional liquidity 
• be held, sold, or used to participate in protocol governance 

Swap fees reflect real usage. Incentives are designed to accelerate growth.

Why this pattern is durable

Nothing about this case relied on special conditions.

There was:

• no liquidity mining campaign driving usage 
• no marketing push 
• no exclusive partnership 

The pool was simply useful.

As long as execution systems need stable, FX-anchored pricing, the pool remains relevant. As overall DeFi activity increases, the number of times those execution paths are triggered increases too.

That is how relatively modest liquidity can support disproportionate volume.

What this tells us about Stabull’s role

Stabull pools are not competing to be the deepest venue for speculative trading. They are competing to be:

• reliable 
• predictable 
• easy to integrate into automated execution 

When a pool succeeds at that, volume becomes a function of ecosystem activity rather than direct user acquisition.

Looking ahead

As more execution systems, aggregators, and protocols interact with Stabull, this pattern is likely to repeat across other pools.

Liquidity does not need to be enormous to be effective. It needs to be usable.

In the next article, we’ll turn the focus explicitly toward liquidity providers and unpack what LPs are actually getting paid for on Stabull — and why non-UI volume often represents higher-quality fee generation than traditional retail trading.

About the Author

Jamie McCormick is Co-Chief Marketing Officer at Stabull Finance, where he has been working for over two years on positioning the protocol within the evolving DeFi ecosystem.

He is also the founder of Bitcoin Marketing Team, established in 2014 and recognised as Europe’s oldest specialist crypto marketing agency. Over the past decade, the agency has worked with a wide range of projects across the digital asset and Web3 landscape.

Jamie first became involved in crypto in 2013 and has a long-standing interest in Bitcoin and Ethereum. Over the last two years, his focus has increasingly shifted toward understanding the mechanics of decentralised finance, particularly how on-chain infrastructure is used in practice rather than in theory.