LPs earn fees when trades occur inside their range. That creates an intuitive belief: “more movement means more fees.” The reality is more conditional.
LPs benefit from volatility that generates activity inside the range. They are harmed by volatility that pushes price out of the range.
Concentrated liquidity concentrates earnings — and concentrates the conditions required to earn. Once price exits the range, the fee window closes.
“Short volatility” does not mean you are betting against movement. It means your payoff deteriorates when movement exceeds your container. The container is your range.
LPs do not need calm markets. They need markets that move inside a structure.