Uniswap Founder: AMM Outperforms Order Books in High/Low Volatility Markets and Popular Token Sectors

Odaily News Uniswap founder Hayden Adams posted on the X platform, strongly opposing claims about the disadvantages of AMMs (Automated Market Makers). Hayden Adams pointed out that for low-volatility currency pairs, AMMs can provide stable returns for investors with low capital costs, thereby weakening the competitiveness of professional market makers. In high-volatility, long-tail markets, AMMs are the only scalable option. When project teams or early supporters act as liquidity providers (LPs), their effectiveness in creating liquidity is superior to paying option fees to market makers.

Regarding the high-volatility, popular token market, Hayden Adams stated that AMMs are continuously growing. Although order books are currently in their best state, the development of AMMs is still in its infancy. Through the development of Hooks in Uniswap v4, more profitable liquidity pools will be provided in the future. Hayden Adams believes that due to the advantages of low capital costs and the ease of composability and collateralization of liquidity, AMMs will ultimately prevail in this field.