DEX and CEX liquidity are complementary but require distinct strategies. CEX liquidity is managed through order book placement and is highly responsive to market conditions. DEX liquidity is typically provided through automated market maker (AMM) pools and is governed by bonding curves and concentration ranges. Arbitrageurs naturally bridge the two venues, but significant price divergence between DEX and CEX can create friction and erode confidence. Your market making strategy should account for both venues, with clear allocation guidelines for how much capital is deployed on-chain vs. on centralized exchanges.