Proprietary AMMs Dominate DeFi Trades with 90% Market Share

The decentralized finance (DeFi) space has seen a significant shift in how trades are executed. According to an analysis by DWF Ventures, professional Automated Market Makers (AMMs), also known as propAMMs, account for up to 27% of weekly on-chain spot volume. For Solana-to-stablecoin trades routed through Jupiter, a platform that aggregates liquidity from various sources, propAMMs dominate with over 90% market share.

PropAMMs have become increasingly popular due to their ability to offer efficient and reliable execution. Unlike traditional AMMs, which rely on user deposits to provide liquidity, propAMMs use professional trading firms' own inventory and proprietary software to adjust prices in real-time. This allows them to respond quickly to market changes and provide better prices for traders.

A study by Jump Crypto found that over 91% of propAMM fills executed on the Solana network beat the estimated cost for the lowest institutional centralized-exchange fee tier, with a median SOL-USDC fill executing at just 0.72 basis points from its benchmark centralized-exchange midpoint. This suggests that propAMMs are indeed providing better execution for traders.