[mruts]

There's not a market maker in America that's selling and buying in order to provide liquidity.

You buy low, and sell high, that's the end of the story, for both proprietary trading, trading for clients, and market making. There's no fundamental, categorical difference between these functions.

The difference between prop trading and market making is fundamentally about the time horizon of exposure. Market makers are aiming to zero out their exposure through frequent trading, while prop trading attempts to express a view on the market in the long-term (seconds for market making vs minutes/day/years for prop trading).

I'm a professional quant, and I don't see much of difference, at least as far as the government is concerned.