> Crypto is flooded with liquidity so market making is like selling ice to an eskimo.

This is not true at all, in general quoting in these markets is absurdly capital-intensive compared to tradfi.

> These days a naive market making strategy in crypto just incinerates capital very reliably as the tiny bid ask spread is a small fraction of the adverse selection risk (whole spread moving past). They did probably make money on this in the early days and got smoked when the sophisticated tradfi players joined.

Are the sophisticated tradfi players here yet? Seems like no?