They are, but there is plenty of arbitrage. Bots send the HBD to other exchanges (mostly Upbit) and pull back from there HIVE.
By doing it entirely on the internal exchange there is full transparency of the entire process. None of the funding whatsoever ever leaves the chain before being returned (with profit) to the DHF.
is there an option to do this on Bittrex?
Bittrex is slow (transfers take at least 5 minutes to be finalized) and unreliable (deposits/withdrawals were often disabled for ages over the last months).
Something you have to take into consideration when writing a bot.
I prefer to keep the transparency for now. There are bots that do arbitrage trades between internal and bittrex as well.
And who gets the profits from the bots?
Whoever runs them, but it's usually pretty small. The prices are roughly in line, people are picking up pennies. If the profits are large, then I would encourage you to do the same thing and get your share (doesn't even necessarily have to be a bot, you can just trade manually if there is a large abitrage and you think you can make money from it). This will help keep the prices even more in line.
And to be explicit, I don't run any of these arbitrage bots, I don't know who runs any of them. I don't benefit in any way if they make money.
I do run a market maker bot that does nothing but trade neutral (buying and selling equal amounts) to keep the spread in the internal market low. It also has all activity on chain so it is transparent (@teamsmooth-mm).
Thanks, explicit answer!