BM, can you answer my question about whether there is an equivalent thing or person that performs the function of the arb bot that you described, as part of the structure of the stock market other than just traders? This is for my education please.
As part of the structure of a "market" not that I am aware, but I think you can view it like a business.
We all know that if the market peg holds then every deviation from the peg is a profit opportunity. We all expect someone to perform the role of providing liquidity. How do we expect these individuals to do that job? If a DAC hard-codes business rules into a blockchain, and we all know that providing liquidity is a profit generating business, then we can encode the same rules that a trader would execute into a blockchain and the network can make money the same way.
The benefit a trader has is they can maintain a dynamic spread, increasing/decreasing as necessary to account for volatility. I think that if you hard-code a bot with very wide buy/sell prices around a trusted feed then the bot would almost never execute, but everyone would "feel better" just knowing it is there to back things up.