Happy to chat about some of these valid concerns.
First, we believe that fractionalization of liquidity on L2s is inherently less impactful due to lower gas costs on the chain. Splitting a trade between two pools on an L2 has less fixed costs from reading contract into state, which means that a price sensitive transaction is more likely to split. We have seen this empirically with routers more likely to split trades on L2s. This likely means that there will not be a large market impact from liquidity fragmentation.
We believe that the below graphic is the best explanation of the current situation. Price sensitive retail flow is defined as flow that originated from an interface that is not associated with a DEX project. Some examples are Matcha, 1inch, Odos, etc.
We choose this metric as these users are purely looking for the best price for execution on the chain. As we can see, over the last 28 days, the majority of volume from these interfaces was directed to Aerodrome. This flow is key to capture.
Source: https://dune.com/queries/3991567/6717557
This tracks with our previous analysis on the size of trades on the two pools, which shows that larger (generally more price sensitive) but fewer traders are trading on Aerodrome.
Source: https://dune.com/queries/3969057
Retail flow and what impacts it is one of the current largest unsolved problems in AMM/finance literature. We cannot provide definitive impacts nor optimal rates, but see Aerodrome (which is a v3 fork with minimal changes) as a good natural experiment. Aerodrome can likely react quickly to any changes from Uniswap v3 LPs, which is why we suggested not liquidity mining at this time. We just believe that LPs should be given more choice.