In the world of cryptocurrencies, a trading bot programmed for arbitrage trading made intricate moves within the Ethereum blockchain, including utilizing a $200 million flash loan, to secure a meager profit of $3.24.
Operating on the Ethereum blockchain, a trading bot employed arbitrage trading techniques to exploit price differences between various markets and exchanges. Utilizing flash loans, the bot borrowed a significant amount of DAI from MakerDAO, a decentralized finance (DeFi) protocol, and deposited the funds into the Aave DAI market.
Subsequently, it borrowed Wrapped Ether (WETH) using the DAI, purchased Threshold Network (T) tokens on Curve Finance, and sold them on the Balancer liquidity protocol. Ultimately, the bot achieved a profit of 0.019 Ether, equivalent to around $33 at that time. However, after accounting for high transaction fees of approximately $28.76 and an additional $1 fee, the net profit dwindled to $3.24.
Despite the seemingly small gain relative to the associated risks, some community members still considered it a success, emphasizing that any profit is noteworthy, saying “Profit is Profit”. Doing all of this for such a modest profit, according to one Twitter user, demonstrates the severity of the bear market.
Previously an article on Todayq news stated that the California Department of Financial Protection and Innovation (DFPI) issued desist and refrain orders against five entities that had falsely claimed to employ AI for cryptocurrency trading. Two of these firms were accused of employing actors and AI-generated avatars to impersonate CEOs. Maxpread Technologies utilized an AI-generated avatar named “Michael Vanes” as its CEO, while Harvest Keeper hired an actor to portray Markus Peters, the supposed CEO.
These entities went to great lengths to create the illusion of legitimacy, developing professional websites, social media accounts, and leveraging influencers for promotions. Investors were enticed by promises of exceptional returns through AI-based crypto trading, including multi-level marketing schemes. However, the DFPI deemed these claims false, as the entities eventually ceased processing withdrawals and vanished, leaving investors unable to access their funds.
During March, the value of AI-centered digital assets experienced a surge, driven by platforms like ChatGPT that harnessed AI capabilities. As per Crypto Slate data, the market capitalization for AI-based cryptocurrencies exceeded $4 billion, marking a 63% growth from January. The Graph token emerged as the highest market cap asset, valued at $1.38 billion, with its native token, GRT, facilitating staking, network payments, and earning fees.
AI’s Potential Impact on Trading and Existing Systems: The rise of AI-based cryptocurrencies showcases the growing interest and investment in this sector. As AI continues to advance, its potential impact on trading and existing systems becomes increasingly significant. AI-powered trading bots can execute complex strategies, analyze vast amounts of data, and potentially optimize trading decisions.
Not all bots are engaged in low-profit trades. A bot operator made over $1 million on April 20 by conducting ‘sandwich attacks‘ against meme coin traders. Targeting trading activity from meme coins like Pepe coin (PEPE) and Wojak (WOJAK) led to the majority of the earnings. However, the recent crackdown on fraudulent entities highlights the need for regulatory oversight and investor caution.
While a crypto trading bot’s intricate moves within the Ethereum blockchain resulted in a meager profit, the broader landscape of AI-based digital assets has seen substantial growth. Regulatory authorities’ actions against fraudulent AI-focused entities underscore the importance of vigilance in the cryptocurrency realm. As AI continues to evolve, its impact on trading and existing systems remains a subject of great interest, promising both opportunities and challenges for market participants.