Magic Internet Money

TL; DR: Integrate B.Protocol v2 to offer better liquidation ratios and up to 90% Collateral Factor on chosen non-stable ibTKN Vaults.

B.Protocol is a backstop liquidity protocol for DeFi, handling liquidations in scale. B.Protocol v2 is pooling users’ funds that are dedicated towards liquidations, using the B.AMM (Backstop AMM) novel design.

Expected Benefits: For Users: Have better capital efficiency for using their funds in DeFi. Getting a bigger buffer before being liquidated when using lower CF with better liquidation ratios. For Abracadabra: Being among the first lending platforms in DeFi to offer high leverage/ CF on non stable coin pairs, earn fees for the protocol, grow TVL and user base. For DeFI: Providing a backstop to enable a better liquidation system that can unleash better capital efficiency for DeFi users and more stability for lending and margin trading platforms. Prove again that composability introduces new opportunities in DeFi.

Details: This proposal suggests starting with a pilot experiment, opening a new Vault(s) with higher CF of up to 90%. Details on specific Collateral types will be discussed later.

The Backstop Pool will be open for MIM deposits that will be used for liquidating unsafe CDPs on the backstopped Vaults.

The seized ibTKN collateral will be sold back into MIM and returned into the Backstop pool with any additional profits made during the liquidation and rebalancing process (see the illustrated diagram below).

Incentivizing Backstop deposits: In order to incentivize early depositors into the backstop pool of MIM, and in order to demonstrate the endless composability opportunities in DeFi, a joint Liquidity Mining program will be put in place, that will reward MIM liquidity providers to the Backstop pool with SPELL and BPRO. The required amounts for the LM will be discussed at later stages.