Stellar Development Foundation held an open protocol discussion on CAP 37 and CAP 38, two competing proposals to introduce automated market makers (AMMs) at the protocol level. After extensive debate on implementation approaches, the CAP committee unanimously voted to move CAP 38 into final comment period, choosing the simpler best-venue routing model over CAP 37's more complex interleaved approach.
The Stellar Open Protocol discussion on June 17, 2021 focused on two core advancement proposals (CAPs) for adding automated market makers to the network. CAP 37 proposes interleaved order routing that allows trades to execute partially against AMMs and partially against the DEX, while CAP 38 uses best-venue routing where orders execute fully against one venue or the other. The committee discussed trade-offs including arbitrage risks, UI requirements, and implementation complexity. Concerns about potential arbitrage spikes and failed transaction volume were addressed by noting the network has been stress-tested and can handle increased traffic. The committee decided CAP 38 represents a minimal viable AMM implementation that can be deployed faster, with CAP 37 potentially retrofitted later as an enhancement. All three voting members unanimously approved moving CAP 38 into final comment period pending acceptance.