These days, I see people interpreting large on-chain transfers and exchange hot and cold wallets as "smart money," and the comment section is already speculating on the plot. To be honest, I care more about what happens if you really go into AMM market making—how the curve moves and what you are risking.

Many people think that just putting assets on both sides into the pool allows them to sit back and collect fees, but once the price deviates, your position is automatically swapped by the AMM into "the one that has dropped more." Impermanent loss, in simple terms, is the cost of your passive rebalancing along the curve. It might be okay if the market moves sideways, but in a one-sided trend, the fees might not cover the losses. Anyway, when I look at a pool now, I first check if the volatility and trading volume match, then decide whether to be the "passive absorber" or not. That's my current approach.