How unequal pool sizes affect the value of additional liquidity

The number of pools says little about how much each contributes to execution. At comparable prices and fee structures, a deeper pool can absorb a larger amount before its average rate deteriorates by the same proportion.

A matched constant-product example

Assume hypothetical fee-free pools with equal initial one-for-one prices. Pool A has 100,000 units on each side. Pool B has 10,000 on each side. A 1,000-unit input returns approximately 990.099010 from A and 909.090909 from B.

Pool B's existence therefore does not represent another Pool A's worth of capacity. Counting both as two equally valuable “liquidity sources” misses a substantial execution difference.

Scale the size as well as the pool

If B receives only 100 input units, its input-to-reserve ratio matches A's 1,000-unit case. It then has the same relative average-rate shortfall in this simplified model. The comparison demonstrates proportional capacity, not an absolute ranking for every requested amount.

The constant-product reference output calculation makes the reserve and size dependence explicit.

Check differences beyond size

Real pools can begin at different prices, charge different fees or concentrate liquidity in different ranges. A smaller pool with a favorable initial price may still contribute useful output for a limited amount. Conversely, a large pool may provide little accessible depth near the required price.

To evaluate an additional source, compare its size-specific quote and the net result achievable when it is available. Do not add its entire TVL to an existing depth measure. The useful question is how much additional executable capacity it offers under matching conditions. This page measures that contribution; choosing the optimal allocation among pools requires the routing calculation itself.