Ethereum Researchers Weigh Proprietary AMMs After the Model Captures a Third of Solana Trading

A post on Ethereum's research forum by contributors Mike and Maryam examines proprietary automated market makers, or PropAMMs, a design that now facilitates roughly one-third of on-chain trading volume on Solana. Unlike open constant-product pools where anyone supplies liquidity on fixed terms, a PropAMM lets a single market maker run an active strategy inside the contract, quoting and re-pricing against cheap, fast on-chain oracles while preserving composability with the rest of the chain.

The significance is where the contest in crypto is moving. As raw execution speed and data availability become commoditized across chains, the durable advantage shifts to market microstructure: who controls quoting, how order flow is priced, and who captures the value between the trade and the settled block. PropAMMs concentrate that control in professional market makers rather than passive liquidity providers, which improves quotes but raises questions about how much of the on-chain trading surface a few sophisticated actors come to dominate.

The analysis frames PropAMMs as a case study in a broader shift toward mechanism design as the frontier of on-chain finance. Ethereum's decentralized-exchange volume has historically run through open pools. Whether the network adopts the proprietary model, and on what terms, will influence how much trading value accrues to liquidity providers versus specialized firms.