David Schwartz, Ripple’s chief technology officer, has developed a new trading robot that uses an algorithm similar to XRP Ledger’s AMM algorithm.
David Schwartz, Ripple’s chief technology officer, has developed a new trading robot that uses an algorithm similar to XRP Ledger’s AMM algorithm.
Schwartz has already tested the robot, which is designed for trading on centralized exchanges, to trade with Solana.
For now, Schwartz says the code is “really rough,” but he’s thinking about potentially adding a GitLab link.
Is the bot profitable?
In a follow-up post, Schwartz explains that it is too early to say for sure whether or not the bot is capable of generating profits. That said, the Ripple executive expects to earn approximately 11% annually.
At the same time, Schwartz has noted that the robot is unable to take advantage of minor price movements. Additionally, the robot is hampered by trading fees.
Regarding taxes, the Ripple executive has stated that the impact of the text is the same as that of short-term capital gains.
Schwartz also added that it is too early to say if the robot is comparable to the AMM algorithm, as they determine trade sizes in different ways.
Previously, Schwartz stated that he had never used decentralized AMMs.
Is AMM only for XRP?
Earlier this week, Schwartz also clarified that it is possible to create AMMS with any two assets that are supported by the XRP Ledger. He has also predicted that XRP MMAs will be the most popular.
“We sort of prioritize XRP because the algorithm is biased in favor of volatility harvesting, which only makes sense if at least one of the assets is volatile. I think the vast majority of size-weighted AMMs will have XRP like a side.” he wrote earlier.
