These firms are providing increased liquidity at the top of the book, but are not necessarily contributing to the depth of the book, given their preference to trade in small size, as well as in many cases, inability to trade in large size because of balance sheet constraints. They have contributed to lower transaction costs (in terms of the bid-ask spread) for small orders.
But there are question marks around their resilience in times of market stress. The key structural change is the shift in market share from those who provide immediate and continuous liquidity and have the ability to warehouse risk to those who do the same but don’t have the capacity to warehouse risk.