How It Works

We integrate B.Protocol with existing lending platforms by letting the users interact with the lending platforms via a dedicated smart contract interface. And B.Protocol liquidators get a priority in the liquidation process by providing a cushion to the user account when it is getting close to the liquidation price. The below diagram shows how B.Protocol is built atop a generic lending platform. The protocol API to end-user is identical to the lending platform API, and the only difference is that the users are interacting with different addresses. Liquidators provide the cushion with a top-up operation, and a scoring engine updates the user rating whenever he performs an operation. The user rewards are kept in a Jar that is distributed according to the user rating.

The next diagram depicts an interaction between the user, the underlying lending platform, and the liquidators. In the described scenario user borrows 100 DAI when ETH price is $200, and as the price goes down, the liquidity provider (LP) provides a cushion to the user debt. Finally, when the price of ETH hits the liquidation price, the LP liquidates the user on B-Protocol smart contracts and share the profit with the Jar (which later will share it with the users of the platform).