Uniswap V3 introduced the concept of concentrated liquidity in order to create capital efficient markets. Concentrated liquidity allows LPs to set the price range in which they would provide liquidity, so rather than their capital being spread thin across the entire constant price formula curve, it can be directed to a narrower range of prices where there is more market activity. Concentrated liquidity also makes capital more efficient by providing more fees to LPs as well as increasing market depth.
Incentives motivate people to act. By designing regenerative systems with crypto values and Web3 incentives, we have the potential to create the better world we know is possible.