Many lending platform users are receiving suboptimal value owing to a liquidation process that provides low incentives for liquidators to back liquidations and enriches miners through gas wars when bidding for them. B.Protocol has developed a decentralized backstop liquidity protocol that aggregates popular lending protocols under a model that provides additional yield to both lenders and borrowers. EPNS is pleased to announce the launch of a pilot program to provide decentralized push notifications to support B.Protocol’s more efficient lending model.
B.Protocol has developed a decentralized backstop liquidity protocol that enables backstop liquidity providers (BLP) the rights to liquidate under-collateralized loans on Compound, MakerDAO, and soon other platforms as well. Since liquidators no longer bid up gas prices to be the highest priority transaction for undercollateralized loans, profits are higher. The BLPs share their higher profits with platform users. As a result, lenders and borrowers receive additional yield to standard interest rates.
B.Protocol liquidators provide a cushion to a borrower’s undercollateralized account in exchange for priority in the liquidation process by bidding at auction for a franchise and the percent of profit sharing. Users receive a percent of the profit share based on their usage of the platform. And since the liquidators have a stake in the franchise, they are less likely to abandon uncollateralized assets when market conditions change.
On lending protocols such as Compound, for example, when the liquidation price is reached, the BLP liquidates the position on B.Protocol and then shares the profit with the users. By shifting the profits from miners and costly gas wars to loan stakeholders through a smart contract, both the liquidator and lending platform users earn more.
The B.Protocol smart contract connects the different lending platforms, providing lenders and borrowers a choice of interest rates and fees. Managing lending and liquidation, however, involves messages from multiple platforms with no central messaging service. One essential element is missing, decentralized push notifications. DeFi lending platform users are highly dependent on notification services to manage loan services, including:
- Data price feeds such as the best lending interest rates and liquidity pool fees
- Real-time notifications on transaction status and gas price alerts
- Collateralization ratios and liquidation alerts
- Notices of liquidation events and auctions
Though B.Protocol simplifies lending and liquidation by connecting lending platforms, the lack of a decentralized push notification service, until now, means important notifications may be distributed to multiple places, such as email or a Telegram account. A push notification service would allow all platform users to receive and take timely action on important lending notifications while still protecting data privacy as B.Protocol users interact with internal and external data sources.
EPNS, much like B.Protocol, is building a new building block that was missing until now in DeFi. We are super excited to collaborate with the team at EPNS in order to bring our users real time notifications in a decentralized manner to keep them updated with their funds on the lending markets we are integrated with. Yaron Velner, Founder and lead developer of B.Protocol
The EPNS Solution
The EPNS decentralized push notification service sends timely notifications through a single source of communication, the investor’s wallet. All notifications go directly to the user’s wallet where they can take immediate action. EPNS is the first native, on-chain notification solution to stream all crucial time-sensitive information to a user’s wallet. The partnership benefits to B.Protocol users include:
- EPNS will send all data notifications directly to B.Protocol user wallets.
- The EPNS and B.Protocol teams will adapt the highly customizable EPNS protocol to meet the various push notification needs of DeFi data users and markets.
- EPNS channels and users can customize their notification settings for different data notification requirements.
How EPNS Will Support B.Protocol
Under this pilot program, EPNS is building a dedicated channel for B.Protocol (see our lightpaper for definitions of channels, services, and more). B.Protocol users can subscribe to the B.Protocol channel to receive customized notifications to their wallets. Through collaboration with the B.Protocol team, we will gain insight into the push notification needs of users of lending platforms and what they want from the EPNS protocol.
Decentralized notifications will provide real-time data to one wallet so all users can act in a timely manner. Lenders and borrowers can identify the most attractive interest rates and fees across lending platforms. Meanwhile, all users can continue to operate within the private, secure ecosystem of B.Protocol across different lending protocols, without having to deal with integration pains across many different protocols.
EPNS push notifications will help lending platform users and liquidators extract and share more value from B.Protocol. Reliable notifications have a role in ensuring liquidators have confidence in and are committed to the lending platform, commented Harsh Rajat, Founder and Project Lead of Ethereum Push Notification Service.
Looking forward, and as B.Protocol v2 launch is behind the corner, we foresee many new EPNS notification channels being introduced for B.Protocol in particular, and DeFi lending markets in general. The elimination of high gas fees makes decentralized lending accessible to more borrowers and more lucrative for all lending platform users. The role of the BLPs as backers lowers liquidity risk. Push notifications will be essential to enable future B.Protocol users to take advantage of the best lending and liquidation rates. Thus, we view decentralized push notifications as an important service that will accelerate the mass adoption of decentralized lending. Since B.Protocol is at the forefront of creating a new liquidator-backed liquidation model, we expect our partnership to yield many new useful notification services and features for the decentralized lending market.
The long-term goal of the pilot program is to develop a notification system for future versions of B.Protocol. DeFi lending users — who can easily integrate the EPNS protocol into a wallet — will expect push notifications to be an integral service. Going forward, we also expect to work closely with B.Protocol users to create new messaging solutions to meet their evolving push notification needs.
We are pleased to be partnering with B.Protocol and anticipate EPNS push notifications becoming an indispensable tool in decentralized lending markets.
About B.Protocol
B.Protocol is a backstop liquidity protocol for decentralized lending platforms. A new DeFi lego primitive, bringing traditional finance systems best practices into DeFi, aiming to stabilize the ever growing market of DeFi assets which are crucially dependent on adequate liquidation processes. By creating better liquidation systems we unleash better capital efficiency for the entire DeFi ecosystem. B.Protocol is a fully decentralized protocol which is being governed by $BPRO token holders.