I posted this in BitShares DAC telegram group about liquidity pools, and I will post it here again:

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Also, liqudity pools are set up by individuals, not the blockchain. Why would someone want to set up a pool for profit, then have that profit taken from them to keep people who chose to use margin afloat?

Also, profit should not be spread to the debtors, they did nothing to earn the profit from a debt arbitrage done by a smart contract. If a smart contract is to be implemented to deal with bad debt, those holding debt are not entitled to that, but the blockchain due to the smart contract.

• As long as a debtor has collateral above MSSR, he will never be margin called nor fall victim of Global Settlement, independently of the state of other debtors.
• As long as a debtor has collateral above MCR, he will never be force-settled.
• If implemented before, the proposed mechanism would have avoided most, if not all, of previous Global Settlements .
• With the new protocol, debtors are incentivized to adjust their positions for the benefit of the community. This is much better than the current mechanism which punishes them whenever harsh conditions appear. 
• Holders of smart assets are protected and the peg is maintained until the very last possible moment.
• Dex's liquidity and liquidity pools usage is increased.
• A new, innovative market of debt positions is created and with it, a new source of income for the DAC appears.
• Committee is released from the urgency to randomly adjust parameters in order to prevent GS, thus creating better stability for the whole ecosystem and avoiding much of the recent drama

• GS is not activated whenever CR of the least collateralized position falls below 1 but when (total collateral in existence) < (total debt in existence)x(MSSR). This way, GS would not happen as a consequence of the state of the weakest debtor but from the behavior of all debtors as a whole.   
• The above alone implies that some positions could have negative CR. To prevent this, those positions are simply deleted once they reach CR<1 and their debt and collateral is transferred to the remaining, better collateralized positions. This would reduce the CR of those better positions, but it also increases their total debt and total collateral. So, if those positions (which are most likely held by more experienced traders) manage to keep themselves open during sharp declines in bts price, their reward will be much more bigger. 
• Whenever (2) happens, in order to alleviate the burden on the remaining, active positions, all fees for the corresponding market are distributed among them.This way, those positions get compensated for taking on the collateral and debt of the deleted positions. Also, this creates an incentive for those who are willing to open new positions with fresh collateral and so, push BTS price upward.
• Whenever any position has CR < MSSR, an automatic operation (or a bot) is activated that takes the smart Asset from LPs and either buys the corresponding margin wall or force settles that low collateral position, which, at that moment should be at a premium price. Probably there are already some bots doing similar arbitrage. So, this point is optional. In case of implemented, profits from this operation can also be distributed among the remaining debtors.
• Processes (3) and (4) are run until CR > MCR for all existing positions.
• Force settling positions whose collateral is above MCR constitutes unfair and terrible customer service to the users that lend themselves to the hustle of creating smart assets. However, force-settling cannot be totally eliminated because it is a competitive advantage over other platforms that don't have it and, if we don't have a plus over them, then people won't see a need to switch to us. So, force settling is allowed only upto the debt of those positions with CR < MCR. That new condition would required that, If someone wants to get rid of his smart assets and there is no such low CR positions, he must use the markets or the LPs. This has the additional benefit of increasing activity in the DEX.
• In order to allow debtors to exit their positions when they simply are not willing to hold them any longer, an auction system for those positions is created, So, any debtor can sell his position at any time. Also, a system in which any member of the community can offer to buy any debt position is implemented.
• Finally, if under the most super extreme conditions, all positions, one by one, are deleted, and after having all debt and collateral being transferred to the last, most stronger debtor, and after receiving help from fees and bots, he also falls below CR=1, then GS happens and bidding for collateral is allowed. Manipulating feed producers in order to prevent collateral bidding is also terrible costumer service, in my opinion.

I support the following BSIPs:


    BSIP 73: Match force-settlement orders with margin calls and limit orders
    BSIP 72: Tanks and Taps: A General Solution for Smart Contract Asset Handling
    BSIP 70: Peer-to-Peer Leveraged Trading
    BSIP 69: Additional Assert Predicates
    BSIP 64: Optional HTLC preimage length, HASH160 addition, and memo field
    BSIP 62: Close margin position
    BSIP 61: Operation to Update Limit Orders
    BSIP 57: Managed Vesting Balances
    BSIP 47: Vote Proxies for Different Referendum Categories and explicit voting operation
    BSIP 45: Add BitAsset as Backing Collateral flag/permission
    BSIP 39: Automatically approve proposals by the proposer
    BSIP 22: Vote Decay for Witnesses, Committee members & Proxies

Also, I am not 100% sure vote-decay will change things to the better, but I am willing to support this experiment.

so that means we need another BSIP to set the threshold feed price for eternity, or it can be increased but not be lowered?

0.202 bitCNY/BTS is cheap even when the market price is 0.19, we can buy at 0.22bitCNY/BTS when market price go to 0.22 without pay additional price , but I think it's not hard to tell which price is better.

1.Delisting of all bitassets outside of DEX
2.Dumping of BTS for other stable coins on CEX
3.Dead market on DEX ,starting from ZERO