# kaal:claim:4067783-037

**Claim.** Centralization and monopolies are a threat to market liquidity because they can carry too much mass or too much velocity, and an imbalance in either direction, too much mass and too little velocity or too little mass, damages the market.

**Type.** mechanism  **Support.** argued

**Source quote.**

> When there is too much mass and not enough velocity, it can gunk up the engine - when there is too little mass in the market, it can be cleared too quickly. Centralization and monopolies are a threat to market liquidity as they can have too much mass or too much velocity.

**From.** Wulf A. Kaal, *DAO Fallacies* (2022), III.4 Use #4: Efficiency, page 16

**Cite as.** Wulf A. Kaal, DAO Fallacies (2022). SSRN: https://ssrn.com/abstract=4067783

**Verify.** sha256 of source PDF `48f1e307cdbbe28c7843f7744d0ba8cf01662f257a53f2066a7a6c7e03a5acec` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20-%202022%20-%20DAO%20Fallacies.pdf

**Failure mode.** Centralized power accumulation degrading liquidity  (family: liquidity-and-market-structure-failure)

**Topics.** economics, defi, decentralization

**Keywords.** market-efficiency, liquidity, centralization, monopoly

**Related claims.**

- extends: https://wulfkaal.github.io/claims/3782191-036
- extends: https://wulfkaal.github.io/claims/3782216-020

**Canonical form.** This markdown file is the canonical hashed representation of the claim. Its sha256 is the content hash used for attestation.