A recent study by Cornell Tech researchers warns that collective crypto trading schemes, known as Collective Investment Algorithms (CoinAlgs), are inherently vulnerable to exploitation and profit loss. The research, published on January 2, highlights the trade-offs between profitability and economic fairness in these systems, which pool user funds for automated trading. The study found that CoinAlgs face unavoidable risks, whether they maintain transparency or keep strategies private, as both approaches can lead to unfair value extraction by insiders or arbitrageurs. The researchers used Uniswap transaction data to simulate CoinAlgs, revealing that even minimal information leakage can enable significant arbitrage opportunities. Transparent CoinAlgs, while avoiding insider trading, still suffer from profit erosion due to arbitrageurs exploiting open-source strategies. Despite these challenges, CoinAlgs remain popular, driven by the promise of AI-powered investment strategies, with interest expected to grow as AI development continues.