Proprietary AMMs Quietly Route Up to 90% of Some Solana Trades Back to Wall Street-Style Market Makers

The Swap Button Hides a Trading Desk

Open Jupiter, ask it to swap SOL for USDC, check the price, and press the button. From the user’s point of view, there is not much more to it, and it is natural to assume that Jupiter is where the trade happens. In reality, Jupiter is closer to a search engine for liquidity. Its software looks across different venues willing to take the other side of the trade, compares what they are offering, and sends the order toward the best route it can find, choosing among ordinary decentralized exchanges, proprietary automated market makers, and a request-for-quote network where professional market makers compete to quote a price.

That means the entity selling you USDC might not be another user or a public pool funded by thousands of strangers. It could be a professional trading operation using its own money and pricing software, with no consumer-facing exchange and no pool into which you can deposit your own tokens. You never see most of that machinery; you just see the price that comes out of it. According to analysis from DWF Ventures reported by CryptoSlate on Sept. 13, proprietary AMMs, or propAMMs, now account for roughly 15% to 27% of daily on-chain DEX volume, and for one narrower corner of the market — SOL-to-stablecoin trades routed through Jupiter — their share is estimated above 90%.

The Dealers Are Back in Business

The original automated market maker was one of DeFi’s stranger inventions. Picture a currency booth with two piles of money and no dealer behind the glass: software connects the piles with a formula, and anyone can deposit capital and collect fees. That solved an enormous problem for early DeFi, because a new market did not need to persuade a professional firm to keep buying and selling all day. It needed tokens, a smart contract, and willing depositors.

Running itself, though, is not the same as being good at trading. Academic work calls the weakness loss-versus-rebalancing: a passive pool can repeatedly trade at yesterday’s price against traders who already know today’s. A propAMM reverses the arrangement. A professional trading firm supplies its own inventory, and its private software watches outside markets and continually reprices what it is willing to buy or sell. The transaction still settles on-chain, but the thinking that produced the price happens inside the company — closer to an electronic currency dealer installed inside a blockchain than to the vending-machine model that defined early DeFi.

The execution quality is difficult to argue with. Jump Crypto examined roughly 20 million propAMM fills from March and compared them with prices on Binance, Coinbase, OKX, and Bybit. The research found the median SOL-USDC fill executed 0.72 basis points from the benchmark centralized-exchange midpoint, and 91.9% of fills were cheaper than Jump’s estimate for the lowest institutional centralized-exchange fee tier. Both DWF and Jump are trading firms with commercial exposure to this market structure, so the numbers deserve that caveat — but the results help explain why routers keep sending these venues volume.

Transparency Splits in Two

Solana’s own explainer on proprietary AMMs notes that today’s propAMMs are generally closed-source, their liquidity is not open for ordinary public deposits, and inclusion by an aggregator is a permissioned process. Users can verify that a transaction happened on-chain without being able to inspect the system that decided what price to offer, or why one market maker won the order.

The easier conclusion would be that DeFi spent years trying to escape Wall Street and then rebuilt it anyway, but that reading is too simple. What crypto may actually be doing is separating two things that once traveled together: transparency of settlement and transparency of execution. The settlement layer can be open while the execution layer contains private firms competing with one another — and because professional market makers can protect themselves from stale prices, they do not have to build those losses into every quote shown to ordinary users.

The trade-off moves somewhere else. If users stop choosing exchanges and start choosing routers, the router gains enormous influence: it decides which firms compete, which liquidity sources receive an order, and how quotes are compared. Blockworks Research has already examined the relationship among market maker HumidiFi, transaction-landing system Nozomi, and block builder Harmonic — all associated with Temporal — and found periods when HumidiFi price updates reached Harmonic validators first far more often than other setups, an advantage that later disappeared. When several layers can influence execution, what exactly counts as best execution on a blockchain is a question DeFi is only beginning to rediscover.

Public Pools Are Not Going Anywhere

None of this means the original AMM is disappearing. Professional market makers work best when an asset has deep reference markets elsewhere — SOL trades around 100 USD in the current market, Apple has a stock exchange, Treasuries have a reference price. Now imagine somebody launches an obscure token at 3 a.m. with no outside market and no professional firm willing to warehouse it. Public AMMs do not need to know what it is worth; someone supplies the token and a stablecoin, and trading can begin.

The DWF data is therefore more interesting as evidence of a sorting process than as proof that one design is replacing another. Professional liquidity is winning the liquid core; public pools retain the long tail, where permissionless market creation matters more than shaving fractions of a basis point off execution. Tokenized finance could divide along the same line, with tokenized equities and majors handled by sophisticated dealers competing behind routers while unproven assets still depend on public pools.

Crypto began with a grander cultural promise: software would remove the financial middleman. Its trading markets are producing a more complicated answer. The rails can be public, settlement can be inspectable, and professional dealers can compete over the same order without owning the infrastructure underneath it. The person pressing Swap may never know which one won — the future exchange may be a blockchain everyone can inspect, wrapped around a trading desk almost nobody can see.