Thanks a lot for taking the time to read the whitepaper and respond.
Before replying to the specific questions, I would like to emphasize that B.Protocol indeed aims to build a more efficient backstop for DeFi lending platforms that will improve capital efficiency of lending platforms.
However, the current proposal/idea is very narrow focused in its scope. Typically we offer projects to fully rely on B.Protocol for the liquidation process, and offer better capital efficiency (i.e. collateral factor) to the users. Here we simply suggest to use our developed technology only with the emergency funds without any change in the core Compound protocol.
The B.AMM technology do not offer any novelty for simple portfolio rebalance. However such rebalance by its nature could be semi-manual. E.g., via a governance portfolio committee. Either way, it seems like this issue should be addressed by the Compound community even if the funds are not deposited at the B.AMM (as it is better not to hold the emergency funds in volatile assets).
Uniswap is just an example, and in this case maybe just depositing the funds to compound is the most natural thing to do.
This is a valid question. New protocols like liquity.org and MakerDAO liquidation 2.0 offer such incentives, and those could be used also in compound (e.g, offer 0.5% of liquidation size to the tx invoker, and this can be done in the B.AMM, outside of Compound’s core protocol).
There are also automated serviced such as Keep3r, Chainlink keeper, and Gelato that could also help ensuring such txs are invoked.
Moreover I would argue that to some extent, as in the absence of B.Protocol those funds were meants to seat idle anw, a missed liquidation is not necessarily a risk, as it would be missed also with the current status quo.
Nevertheless I do believe it is only a matter of time before DeFi protocols would decouple the trading incentive in liquidations from the tx invocation incentives, and this seems to be the new norm.