What’s the advantage of providing incentive for the Objective to provide o2 with a better rate than is the AMM spot price though? If there are concerns with external price, and we assume we know AMM curves, then AMM spot price seems like a more natural cap.
As pointed out by Marco, this does not perfectly discriminate between solutions, one property we need. If there is a perfect COW-trade, I’d say that AMM spot price is the fair exchange rate.