rewrite this title AMMs vs. Onchain Orderbooks: What Changes When Makers Control the Curve?

Automated market makers changed what an exchange could be.

Instead of waiting for professional market makers, a project could create an onchain pool, deposit two tokens, and make a market available to anyone. Pricing, execution, and settlement could all happen through smart contracts.

That model became so dominant that the AMM is often treated as the natural shape of a decentralized exchange. In reality, it’s only one way to organize onchain liquidity, with strengths and constraints that follow directly from its architecture, including slippage (price uncertainty) and MEV sandwich attacks.

Traditional orderbooks offer another model. Makers publish bids and asks that specify how much they are willing to buy or sell and at what price. Each order represents one price level in the orderbook.

An AMM is a very specific subsect of an orderbook that relies on explicit instructions to maintain itself. — Dr. Mark Richardson, Bancor Project Lead

Many DEX products described as “limit orders” work differently. The user communicates the price they want, but also defines the minimum amount they are willing to receive if the trade executes. The requested price and the minimum acceptable result are therefore not necessarily the same.

In practice, the order behaves more like an offer or execution instruction. An external solver, or a taker in general, attempts to execute it within the user’s acceptable boundaries. Settlement may happen onchain, but the user is not necessarily publishing native maker liquidity that guarantees execution at one exact quoted price.

Bancor takes a different approach with Carbon DeFi. A Carbon Limit Order is an executable onchain offer at the maker’s exact price. Full and partial fills execute at that price, providing the maker with 100% price certainty and 100% of that amount. The price they set is the amount they receive when the order is filled.

Carbon DeFi also allows the maker to publish an executable pricing curve across a range. If a maker is placing three separate orders to sell 100 tokens at $1.00, 100 at $1.05, and 100 at $1.10, then those orders create three distinct price levels.

A Carbon Range Order can instead offer 300 tokens progressively between $1.00 and $1.10. The curve defines the precise amount available at every price throughout that range. As the market moves through it, Carbon DeFi’s built-in solver system helps fill the order progressively against the maker’s predefined pricing.

“Executable pricing curve” therefore means a standing onchain order containing the complete pricing instructions for the maker’s liquidity. It can define one exact price or every price across a continuous range, and trades execute directly according to those instructions.