I used to think AMM market making was pretty "stable," just put in liquidity on both sides and wait for the fees... But after being hit hard by impermanent loss, I woke up: when the price moves, your position is automatically converted along the curve to the "less appreciated" side, and sometimes the earned fees aren't enough to fill the hole. Honestly, it's not passive income; it's taking volatility as the counterparty.

Now, seeing new L1/L2 projects offering incentives to attract TVL, my first reaction isn't to jump in as an "early market maker," but to ask myself: Are these fees supported by a bunch of people mining, selling, and holding up the project? When the incentives stop, with volatility and liquidity withdrawals, IL could look worse than I imagine. Anyway, I only use small positions for market making; if I can't earn, I accept it—just trying to survive.