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Feature: Build liquidation auction system with Dutch auction mechanics #609

Description

@devdianax

Context

Liquidated collateral needs efficient price discovery. Current liquidation at fixed discount may not reflect market conditions.

Current Limitation/Problem

Liquidations execute at a fixed discount regardless of market depth or urgency, potentially leaving value on the table.

Expected Outcome

A Dutch auction liquidation system where collateral price starts at market value and decreases over time until a buyer steps in.

Acceptance Criteria

  • Design Dutch auction: start price = oracle price, decrease linearly over auction duration
  • Configurable auction parameters: duration, min price, discount floor
  • Parallel auctions for concurrent liquidations
  • Auction settlement: buyer repays debt + premium, receives collateral
  • No-show auction: gradual discount increase until liquidator steps in
  • Integration with liquidation bot for automated bidding
  • Auction analytics: avg premium, time-to-fill, slippage distribution

Technical Scope

  • contracts/lending-pool/src/liquidation/dutch_auction.rs - auction logic
  • backend/src/bots/liquidator/auction-bidder.ts - automated bidder
  • Prisma: AuctionEvent, AuctionSettlement models
  • Edge cases: zero bids, oracle price change mid-auction, partial fills

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