security aside, I might use sniping to tie my money up less and bid on more loans rather than as a tool to get the highest rate. For example, If I had $50 in my account I could set up snipes for 10 loans, and the first loan that funds wins my $50.
This sounds like the wish-list HO mentioned which would be a more useful tool IMHO.
This seems like it would not really be effective. If I wait a couple more days to snipe the loan I have to have the money ready to go in my Prosper account anyway. It doesn't earn any interest tied up in there. You could wait a couple days and transfer the money into your account perhaps but you have to do that manually anyway. It doesn't seem to me that automating the bidding process to snipe the loan would really tie up less money.
Unless you want to avoid bidding on loans that aren't going to fund....but, of course, if everyone is doing that then loans that would otherwise fund aren't going to anymore.