Uniswap Founder Predicts AMM Dominance in Global Markets

Hayden Adams, the founder of Uniswap, published his first blog post in two years arguing that automated market makers (AMMs) will take over the world's largest markets once tokenized assets begin trading against each other rather than against dollars.

The core mechanism behind this claim is pairing assets that move together, which cuts risk for liquidity providers. Adams pointed out that onchain liquidity has already organized itself into clusters, Ethereum assets against ETH, Solana assets against SOL, stablecoins against each other, because liquidity providers lose less when the two assets they hold move together.

Adams built his argument on the 50th anniversary of Jack Bogle's First Index Investment Trust. He compared passive liquidity provision to the way passive investing displaced active management, pointing out that Citadel Securities trades close to 25% of US equity volume and has a record $12.2 billion in net trading revenue.

However, not everyone agrees with Adams' thesis. Brian Huang, co-founder of Glider and former XTX Markets trader, replied that 'AMMs are going to zero'. He argued that market makers need to place and cancel orders across thousands of assets at varying depths, which an AMM cannot do.