Hayden Adams refutes the disadvantages of AMM: All three markets won with order books

Uniswap founder Hayden Adams recently shared his views on social media, openly opposing claims about the disadvantages of AMMs. He used three specific market scenarios to demonstrate that automated market makers are not outdated; on the contrary, they outperform traditional order book models across multiple dimensions. This perspective reflects a deep insight into the evolution of the DeFi market and hints at a new strategic adjustment brewing within the Uniswap ecosystem.

Three Markets, Three Victories

Hayden Adams’ argument framework is very clear. He divides the market into three types of scenarios, explaining the advantages of AMMs one by one:

Low-volatility currency pairs: a haven for stable returns

In low-volatility scenarios such as stablecoin pairs and fiat currency pairs, AMMs can offer investors with low capital costs stable earning opportunities. This directly weakens the competitiveness of professional market makers. Traditional market makers profit from informational advantages and large capital pools, but in low-volatility markets, AMMs reduce participation barriers through automation, allowing ordinary LPs to earn substantial fees.

High-volatility long-tail markets: the only scalable option

This is where AMMs have their most significant advantage. For long-tail tokens with low trading volume and high volatility, traditional order book models simply cannot provide liquidity—professional market makers are unwilling to bear the costs for these tokens. AMM mechanisms are naturally suited for such scenarios: project teams or early supporters act as liquidity providers, creating liquidity that far exceeds what would be paid in options fees to market makers. This means thousands of new projects can find liquidity on AMM platforms like Uniswap, a scale unimaginable for order book models.

High-volatility hot tokens: enormous potential at the early stage

This is the most interesting dimension. Hayden Adams admits that, in this market, order books are currently in an optimal state. But he emphasizes that AMMs are only at the beginning here. Through the development of hooks in Uniswap v4, more profitable liquidity pools will be available in the future. In other words, he is hinting that AMM competitiveness in hot token markets is rapidly evolving, and we should not judge its future position based on current performance.

What the ecosystem data says

Looking at market performance, Hayden Adams’ confidence is not unfounded. According to the latest data, in 2025, based on total generated fees, Uniswap ranks third with $1.06 billion, behind Meteora’s $1.25 billion and Jupiter’s $1.11 billion. Although third place, Uniswap remains a dominant player in the Ethereum ecosystem as the most important DEX.

More importantly, recent ecosystem developments show new ambitions:

• Protocol fee switch officially launched, ushering in the era of UNI token revenue sharing
• Burned 100 million UNI, reducing supply by 16%
• Released a comprehensive ecosystem roadmap, gradually ending the Labs entity
• Implemented traceable burn mechanisms

These initiatives indicate that Uniswap is evolving from a simple liquidity platform into a “cash flow certificate.” UNI holders will be able to share in the protocol’s real earnings, not just governance rights.

Why release this viewpoint now

Hayden Adams chose to speak out at this particular time for strategic reasons. On one hand, skepticism about AMMs persists in the DeFi market, especially in hot token trading, where the depth advantage of order books is obvious. On the other hand, the Hook mechanism in Uniswap v4 has begun to show its power, giving the founder more confidence.

More deeply, this perspective provides theoretical support for upgrading Uniswap’s fee distribution mechanism. If AMMs truly outperform order books in multiple markets, then Uniswap, as the leading AMM, has significant commercial value and revenue potential. This also explains why UNI has recently become a market focus—the market is re-pricing this once underestimated “liquidity platform.”

Summary

The core of Hayden Adams’ view is: AMMs are not declining but maturing. From low-volatility stable returns, to being the only choice for long-tail tokens, and to the future potential of hot tokens, AMMs are responding to skepticism with facts. Coupled with recent changes in fee mechanisms and ecosystem upgrades, this argument is not only a technical defense but also a declaration of Uniswap’s strategic shift—from a liquidity aggregator to a yield-generating protocol. UNI is redefining its value in DeFi.