What sucks more is the artificial ceiling at 1%/day. Bitcoin can be (as shown AGAIN today!) be FAR more volatile than this. Either remove FRR from auto-taking offers (so FRR needs to be taken manually, an easy fix to the whole "my fixed rate does not get taken" issue) or remove the 1% ceiling on auto-taking offers, so the FRR can rise faster.
I think a cap is sensible though. What if you borrow, there is a spike and you suddenly end up taking a 50% loan or something. With this insane FRR walling nobody has any incentive to fill the Grand Canyon wide gap between the super low FRR and the ceiling though and you'll always end up with these spikes as soon as the FRR is chopped down.