Overview
Serum launched in August 2020 as a fully on-chain central limit order book (CLOB) on Solana, founded by FTX CEO Sam Bankman-Fried and the FTX/Alameda Research team. It was a technically ambitious project — building an order book that could match the throughput of centralized exchanges using Solana's high-speed, low-cost architecture. At its peak, Serum was the backbone of Solana DeFi, with protocols like Raydium, Mango Markets, and dozens of others building on top of its order book infrastructure.
The fatal flaw was always the centralization of control. FTX/Alameda held the upgrade authority keys to Serum's smart contracts, meaning they could modify the protocol unilaterally. When FTX collapsed in spectacular fashion in November 2022 — revealing billions in customer fund misappropriation — Serum became an immediate security risk. The Solana community could not trust contracts whose upgrade keys were held by a bankrupt, potentially malicious entity.
Within days, the Solana developer community forked Serum into OpenBook, a community-controlled version. Original Serum was abandoned entirely.
Smart Contracts
Serum's contracts were technically innovative — implementing a full CLOB on-chain was a genuine engineering achievement on Solana. The matching engine handled order placement, cancellation, and settlement with millisecond-level latency. However, the entire contract suite was compromised by FTX holding the upgrade authority. After FTX's collapse, these contracts became untrusted and potentially dangerous. No one should interact with original Serum contracts. The code was forked into OpenBook, which operates under community-controlled keys.
Security
Serum's security rating is effectively zero. The protocol's upgrade authority keys are controlled by the FTX bankruptcy estate, which could theoretically upgrade the contracts to drain any remaining funds. Even if this is unlikely, the risk is non-zero and unacceptable. There are no active audits, no bug bounty, and no security maintenance. Any funds remaining in Serum contracts should be considered at risk. This is the ultimate cautionary tale about centralized control of supposedly "decentralized" protocols.
Liquidity
Zero. All meaningful liquidity migrated to OpenBook, Jupiter, Raydium, Orca, and other Solana venues immediately after FTX's collapse. Serum's order books are empty. There is no trading activity. Any tokens appearing in Serum pools should be treated with extreme suspicion.
Adoption
Serum was once ubiquitous in Solana DeFi — virtually every Solana DEX, lending platform, and trading interface used Serum as its underlying matching engine. This dependency on a single FTX-controlled protocol was a systemic risk that the community did not fully appreciate until it was too late. Post-collapse, adoption is zero. OpenBook and Phoenix have replaced Serum's role in the ecosystem.
Tokenomics
SRM was one of the most controversial tokens in crypto. It had a total supply of 10 billion tokens, with the vast majority held by FTX/Alameda insiders. The token's "fully diluted valuation" was used to inflate FTX/Alameda's balance sheet by billions of dollars — SRM held as collateral at inflated valuations was a key component of the fraud. Post-collapse, SRM is effectively worthless. The token has no protocol to govern, no revenue to capture, and no community to support it. The FTX bankruptcy estate holds billions of SRM tokens that will never have meaningful value.
Risk Factors
- Protocol is Dead: Serum is not operational. There is no team, no development, no maintenance.
- FTX Upgrade Authority: The upgrade keys are held by a bankrupt entity, making any interaction with original contracts a security risk.
- Token is Worthless: SRM has no utility, no governance function, and was central to FTX's fraudulent balance sheet.
- Bankruptcy Proceedings: SRM tokens are part of FTX bankruptcy proceedings, creating permanent legal and supply overhang.
- Reputation Contamination: Serum's association with SBF and FTX fraud makes any revival impossible.
Conclusion
Serum is dead, and it deserves to be. What was once Solana's most important DeFi primitive was fatally compromised by its dependence on FTX — a centralized, fraudulent entity that controlled the keys to a supposedly decentralized protocol. The SRM token was always a vehicle for FTX/Alameda balance sheet manipulation, and its current near-zero value reflects its true worth. The only positive legacy of Serum is the technical proof-of-concept that on-chain order books are viable on high-throughput chains, a concept now carried forward by OpenBook and Phoenix. Do not buy SRM. Do not interact with Serum contracts. This protocol is a monument to the dangers of centralized control in DeFi.