They are in the sense that they level the playing field. People wouldn't give me millions of dollars to do arbitrage in real life, but I can borrow $200 million from a smart contract without issues if I find a profitable opportunity with it. That is game changing.
That said, there are still challenges. Last week, for 6 hours, there was $1 billion up for grabs [1]. Nobody noticed it except for one person, who only took $13.5 million. But bots are coming that will spot these things instantly....I have one under development that would have caught it.
On a tangent, what distinguishes a successful bot from a poor bot? For many of the arbs, the logic is simple to imitate. I understand there is some infrastructure engineering (having servers close to some node) involved, but besides that, it seems a level field in terms of money and tech.
And despite this being inherent in the DeFi world, people still believe that such systems are better than fiat money?