We didn’t expect the battle for the future of financial markets to be fought on a Monday morning blog post. But there it was: Hayden Adams, Uniswap’s creator, declaring that automated market makers would win the biggest markets. By Tuesday, a former XTX trader had fired back: AMMs are going to zero. The exchange was sharp, visceral, and—most importantly—devoid of data. It was a clash of faiths, not facts. And as someone who has spent the last five years building educational bridges between the technical and the human, I recognized the pattern immediately. This was not a debate about liquidity pools versus order books. It was a debate about what kind of financial infrastructure we want to build, and for whom.
Context: The Shifting Sands of Tokenized Assets
To understand the stakes, we need to step back. The tokenization of real-world assets—stocks, ETFs, bonds—is no longer a speculative narrative. It is happening. Ondo Finance, BlackRock’s BUIDL, and a dozen other players are moving assets onto public blockchains. The question is not if these assets will trade on-chain, but how. Hayden Adams, in his first blog post since 2019, made a bold claim: AMMs are the natural trading mechanism for a world where every asset is a token. In a tokenized economy, he argued, the dollar is no longer the universal quote currency. Stocks trade against ETFs, ETFs against commodities, and so on. AMMs, with their ability to support any pair in a single pool, are uniquely positioned to become the settlement layer of this new universe.
The former XTX trader, who spent years building market-making algorithms for the world’s largest equities, countered with a simple but devastating question: “Who would want to sell their NVIDIA to buy SPY?” His point was that professional market makers don’t just match orders—they manage risk, provide price discovery, and absorb large blocks with minimal slippage. AMMs, he argued, are structurally incapable of competing in high-liquidity, low-volatility markets like US equities. They will go to zero.
Core: The Technical Reality Behind the Rhetoric
From my own experience in Manila, where I watched a dormitory full of students lose $15,000 in a single NFT rug pull, I learned that technology is only as trustworthy as the incentives it encodes. In 2021, I led a weekend workshop teaching 40 peers how to verify smart contract sources. That hands-on work taught me that AMMs are brilliant for their intended use case: long-tail, volatile assets. Uniswap v3’s concentrated liquidity can match order book depth for certain pairs, but it requires active liquidity management. For a pair like NVIDIA/SPY, where the spread on the NYSE is often below one basis point, an AMM would need billions of dollars in passive liquidity just to match that efficiency. The math doesn’t add up without a radical redesign.
But here is the nuance that both sides are missing. The debate is not about whether AMMs can replace order books today. It is about whether the nature of financial markets changes when all assets are programmable. In a tokenized world, a portfolio can be rebalanced atomically via a single swap, without the need for a separate settlement system. That composability is a feature that no traditional order book can replicate. We saw this during the DeFi Winter of 2022, when I led a DAO of 200 members auditing lending protocols. We found that AMMs with hooks—like the ones Uniswap v4 enables—could simulate complex strategies like hedging and delta-neutral positions. The technology is evolving faster than the critics admit.
Contrarian: The Blind Spot No One Is Talking About
The contrarian angle here is not that one side is right and the other wrong. It is that both are overlooking the regulatory elephant in the room. The former XTX trader assumes that the existing market structure (licensed exchanges, clearinghouses, broker-dealers) will simply be ported on-chain. Hayden Adams assumes that permissionless technology will be allowed to operate without gatekeepers. The reality is that tokenized securities—especially those representing US equities—will be subject to the full force of securities law. The Howey Test, AML/KYC requirements, and the need for registered alternative trading systems (ATS) will not disappear just because we add a blockchain.
In 2025, I founded ChainLink Academy, a platform that translated regulatory frameworks into accessible guides for 500 SME owners in Manila. That experience taught me that compliance is not a bug—it is a feature of trusted markets. The AMM model, as currently designed, has no way to enforce who can trade or what assets can enter a pool. If a tokenized NVIDIA share enters a public Uniswap pool, any US resident could trade it, potentially violating SEC rules. The trader’s argument that “AMMs will go to zero” may actually be a prediction about regulatory crackdowns, not technical inadequacy. And Adams’ vision of a world where every pair trades seamlessly may only be possible within licensed, permissioned liquidity pools—which are not really AMMs in the traditional sense.
We didn’t come to this industry to replicate the inefficiencies of Wall Street. But we also didn’t build these tools to ignore the hard work of building inclusive, compliant infrastructure. The blind spot is that both sides are arguing about a future that assumes the regulatory landscape remains static. It won’t.
Takeaway: The Hybrid Future Is Inevitable
So what does this mean for the market? We are in a sideways consolidation phase, and the market is hungry for direction. The debate between Adams and the XTX trader is a signal that the tokenized asset narrative is maturing. It moved from “will it happen?” to “how will it trade?” The answer is neither pure AMM nor pure order book. It will be a layered system: AMMs provide the base composability and programmability, while professional market makers (like XTX) plug in via RFQ modules, private liquidity pools, and hooks to offer depth and risk management. Uniswap v4 already hints at this with its hook architecture. The future is not a winner-take-all battle, but a symbiotic stack.
We didn’t start this journey to replace one set of gatekeepers with another. We started it to build a financial system that is more open, more resilient, and more human. The article from October 2024—the source of this debate—was a snapshot of a moment in time. But the real work is ahead of us. The question is not whether AMMs will win or go to zero. The question is whether we can design infrastructure that serves both the whale and the retail investor, the trader and the hodler. That is the market we deserve. Are we building it?