In decentralised finance, capital is remarkably fluid. Unlike traditional banking where deposits remain static for months or years, DeFi liquidity migrates continuously, chasing yield opportunities, responding to market conditions, and following sophisticated rotation strategies. This page forensically analyses these movements to reveal patterns that would otherwise remain invisible.

Our analysis tracks Total Value Locked (TVL) changes exceeding 10% in 24-hour periods, examining pools with minimum liquidity of $100,000. By correlating TVL movements with APY changes, protocol characteristics, and temporal patterns, we uncover behaviours ranging from reactive yield-chasing to predictive smart money positioning.

These pools experienced significant capital inflows 1-2 days after APY increases. This pattern suggests reactive behaviour where liquidity providers monitor yield changes and migrate capital accordingly. The lag represents the time required for market participants to notice opportunities, assess risks, and execute transfers.

Yield chasing is the most common form of capital movement in DeFi, representing approximately 60-70% of significant flows. It indicates market efficiency—capital flowing towards higher returns—but also reveals opportunities for more sophisticated participants who can position earlier.

Capital doesn't remain static within protocols. We observe systematic rotations where the same asset (e.g., USDC) experiences alternating inflows and outflows across different protocols on the same chain. This suggests sophisticated liquidity management strategies where providers actively rebalance between protocols to optimise returns.

Common rotation cycles include: Aave ↔ Compound (blue-chip protocol arbitrage), Morpho ↔ Spark (yield aggregator strategies), and multi-protocol rebalancing bots that automatically shift capital based on real-time rate comparisons.

Capital migration across blockchain networks reveals gas cost arbitrage and yield opportunity seeking. We observe distinct patterns where capital flows from Ethereum mainnet to Layer 2 networks (Arbitrum, Optimism, Base) during periods of high gas costs, then returns when mainnet yields spike sufficiently to offset transaction fees.

The rise of native USDC on Layer 2 networks has significantly accelerated cross-chain movements, as bridging delays have decreased from hours to minutes. Polygon and Avalanche also see cyclical capital flows, often following incentive programme announcements or protocol expansions.

Large capital movements (>$1 million in 24 hours) deserve special attention as they often signal institutional activity, whale trading strategies, or coordinated liquidity management. These movements can precede significant rate changes and provide early signals of market shifts.

Whale behaviour differs from retail: larger participants often position early (smart money), hold positions longer (7-30 days vs 1-7 days), and favour blue-chip protocols (Aave, Compound) over newer platforms due to risk management requirements.

Complete record of all detected capital movements meeting our threshold criteria. This comprehensive view reveals the full scope of DeFi liquidity dynamics, including flows that don't fit neat patterns but nonetheless represent material market activity.