> "borg" has basically solved backups permanently. It's deduplicated, even across snapshots, compressed, and end-to-end encrypted.

Deduplication helps minimize space, but isn't it a major liability in backups? I mean, what happens when you try to restore your backups but a lone sector holding a file from way back in the past happens to not be recoverable? Doesn't it mean that no matter how frequent your backups are, your data is lost?

This is bordering on paranoia. If the bad sector contains a critical part of the filesystem, you're going to lose everything anyway.

Do modern disks even have physical "sectors" anymore? Isn't it all virtual?

Without dedup you're just going to backup less stuff, which is far worse.

If you are storing your data in a filesystem like ZFS then the risk is lower since you'll know you have a bad sector long before you attempt to deduplicate. But I otherwise share your same concerns and I'm eager to hear from others how to mitigate this. I've lost a volume due to poor practice while encrypting so I'm understandably reluctant to overcomplicate my backup strategies in the name of space compression or privacy.

It doesn't really hurt in practice because it's only one part of the full backup procedure. Deduplicate to save space; re-duplicate the (smaller) backups to separate media for redundancy; scrub regularly for bit rot and rotate your media. A proper backup system requires all but the first of those anyway.

In that case you are supposed to use your /other/ backup. Which you have.