um now i was going to start with something that we have discussed or was on the roadmap uh pre-exploit and maybe now is the time to talk a little bit more about it which is uh the beanstalk decks um can you maybe briefly uh tell us again what was what was the idea behind the beanstalk decks and how would that work and where where does it fit in the future of being stuck sure so the basic idea is that current implementations of decentralized exchanges in order to attract liquidity all impose some sort of trading fee and at heart the economic incentive to provide liquidity or maybe not at heart this is economics at its core uh the the incentive for for providing liquidity is is that trading fee and that's the case on curve that's the case on uniswap that's the model for every single decentralized exchange and it in short in order for a decentralized exchange to have utility it needs liquidity so it imposes this fee to attract liquidity to create utility now beanstalk has demonstrated a pretty clear ability to attract liquidity uh without trading fees right i think it's a reasonable assumption that the main reason people were providing liquidity in the silo prior to the attack uh was not for the trading fees in the silo uh it was for the being seniority and so the the thesis behind the beanstalk decks or the expansion of the market uh might be the the way to say it within the current beanstalk lingo uh would be to implement or facilitate the deployment of a variety of different amms or other decentralized exchanges or facilitate other decentralized exchanges i should say in a permissionless fashion without any trading fees and the main reason for that is because people can provide liquidity uh you know at the base layer whether that's providing b liquidity uh there shouldn't be a trading fee in that pool or there doesn't necessarily have to be a trading fee in that pool or whether that's trading deposits uh on the route marketplace none of that should have any feeds and so the concept is to fully generalize the bean stock market to facilitate trading fungible and non-fungible assets without any trading fees and that can be facilitated because of beanstalk's ability to attract liquidity without trading fees because of the senior edge okay and where where do we think um this is as a priority when when when we want to work on this and what pool would we expect you know to launch first on the stacks or what what non-being assets would be there to be traders the first thought would be the bean eath pool over time you'd like the beanstalk market to facilitate a variety of different uh amms or uh price invariants uh to start it's likely gonna be a constant product being east pool over time you could implement uh various different price and variants as well uh that's just on the fungible token side okay harry smith asks when can we expect a bean if uh pool i guess my question would be as well uh would we have a being if we swap or the plan is to launch it on you know the bean stock decks i think the hope would be the the first beanstalk dex amm would be the being east pool and that would be a constant product pool i think that's the that's the goal to work towards and i don't think it's unreasonable to make it a goal to have that deployed by the end of q3 okay how how will that this work or the decks work with the decks share all of their credit to this in the silo so anything that's in the silo is you know tradable well there's a lot of different ways to build markets on and around the silo if we take root as an example the concept is for people to be able to take their deposits and enter their deposits into uh trades that settle based on various different things so that's a perhaps a more sophisticated version of trading deposits that's not immediately pending deposits i guess you could trade deposits for one another you could trade fert for deposits you could trade pods for deposits as soon as the withdrawal freeze is down to zero i guess you don't even need the withdrawal freeze down to zero now the deposits are transferable uh although you probably want it to be in order to facilitate all this stuff but it's not a requirement lots of different stuff you can build on this okay um i'm going to like discuss or ask uh further questions uh on this let's say now i have you know been being if uh uh tokens deposited in the in the silo and and that will be used you know for the beanstalk decks um and then you know a user wants to come and buy you know whatever all of the ether we have so they would they would come in and buy as much as uh if as they can um this basically means that beanstalk doesn't have as much if as it did before but it you will it will still owe the same tokens to the depositor the same way if i had been if you know deposited before and someone just came and bought all of the if and am i understanding this correctly no so providing liquidity by holding b lp tokens would be the same as holding b uniswap lp tokens save for there's no uh fee earned for providing liquidity so you're still exposed to impermanent loss the only way to buy eat from that beanie pool is to sell beans into the pool right so if there's a sale of beans into that beanie pool the amount of beans that you would own relative to the eat that you would own would increase i'm not sure if i followed um so i'll ask it again and and maybe you can explain it uh again um so where is the earth coming from if someone wants to come and buy if isn't that if taken from from you know the side of deposits well it's not taken from the siloed deposits it's taken from the liquidity pool right so you're going to have another liquidity pool that is beans and ethereum and then what's deposited in the silo are the b lp tokens but it's not the change in the underlying ratio of beans to eat doesn't affect the deposits other than if you were to redeem the deposit uh the amount of beans in the amount of beef that you would receive would have changed okay let's say uh a scenario now that you know we had two uh two pools uh with fifty percent it was being eth uh uh and then the other fifty percent was being three curve uh and then you know once again someone came and you know bought um you know 25 percent of you know the ether we have for three curve and now uh uh the deposits or the ratio that we're having in the silo is you know 25 percent being if and 75 percent uh being three curve so far so far so good is that correct uh well that's not really the way it would work right so if there's two pools that are half beams and half each and half being uh half beans and half three curve and you assume that there's equal liquidity in both if somebody wanted to get the most value for selling a significant amount of beans they would sell them across both pools in some amount so let's assume that they're sold in both pools uh to significantly lower the bean price right so beans are sold uh eat and three curve are removed from each pool the ratios of the pools are changed uh now what so i i am the person who wants to use the beanstalk decks i have you know three curve with me i want to swap it with eve so i would come in you know in the back what happens is that you know i'm buying uh bean and then i'm buying bean from the three curve pool and then i'm selling it in the spool and then i'm taking this out correct yeah so if you were going from three curve to eve in the bean pool you would be that is correct you'd be selling the three curve into beans and then taking the beans and buying heat with it that's correct so then the three curve bean pool will be you know will have more three curves and and the bean eave pool will have you know uh less eve so you'd expect um arbitrages to take the bean or the excess bean that's in the bean if pool and send it to the b3 curve to to balance the foods correct well you can assume that the keep in mind that the price and variance that the pools use may not be exactly the same so the ratios of b to e and b into three curve may not be the same but the the the price that you'll get per bdv should trend assuming that there's an efficient market uh the arbitragers should arbitrage the prices of the pools to a common bdv marginal bdb yes so what what let's now compare the you know the state before the change and after the change so before the change it was 50 50 three curve eve and now after you know the swap it's more concentrated towards three curves in our example is that correct in the case where someone sells a significant amount of beans for three curve or what in what which we've given a couple examples yes where someone swapped you know three curve for each through with the beanstalk decks uh yes in that case there would be a slight increase in the amount of three curve and a decrease in the amount of deep that's correct what beanstalk ever want to put ratios where it says you know once i reach below let's say 20 percent of if then i don't want to you know swap the if anymore because this is this is the diversification or this is the ratio that we want would do you think would ever want to do that or we don't care come take all of our ease so interestingly mod i don't i think that you know if you assume an arbitrager is acting efficiently the thing that will determine the ratio of e that is being provided as liquidity in the silo relative to three curve that's not a function of the market itself uh because you can assume that those prices will all be efficient the question is what what will people choose to hold their exposure in if they're providing liquidity in the silo so i have deposited lp tokens would i rather have deposited eth or deposited the recurve and you know i think we're a ways away from this being implemented in practice but in a perfect world you can imagine beanstalk having instead of fixed stock and seeds per bdv or maybe fixed seeds per bdb depending on how you want to implement it you can instead have target ratios of different uh assets that being sprayed against so you can have the amount of seeds per bdv deposited or the amount of stock and seeds per bdb deposit probably just seeds uh but maybe both change over time autonomously based on the ratio of being three curve relative to being in in the silo to make holding each exposure in the silo more attractive or less attractive than holding three curve exposure or holding l usd exposure does that make sense but it's related to the market itself you can assume that the market would be pretty efficient so the real question is what do people want to hold exposure to yes that's that's clear and thank you for taking the time to answer these questions all right once again if anyone has you know questions or follow-ups on what we discussed or anything else um feel free to drop them in the in the town hall chat otherwise i'll i'll start with another question uh publius and this may not you know be already been circulated uh but we will continue with that i wanted to discuss a little bit about you know in inflationary and deflationary uh um currencies um so you know we have right now uh bitcoin and and and ether they're both deflationary uh in their um maybe not bitcoin uh specific but uh ether and specific is deflationary um generally this uh speaking um when you have a currency that's so let's talk a little bit about inflation high inflation we know why it's bad and maybe maybe it's you know commonly known why high inflation is bad um and generally it's because people will start you know the value of the matter that i'm holding is losing its value so let me spend it now instead of holding it later uh and this is also the reason for why you know low inflation or really low inflation is also bad because then people will hold into their assets and you know they will not like spend it in the economy or not use it as a currency um so my question is and if if you're being deflationary if we if we reach to a point where you know if they're now stable it's not you know as volatile as it is let's say now do you still see it being used as a currency or just given its deflationary nature it cannot really be used as a currency because people will always want to hold ether and not use it all right so that's a very interesting question that you asked but also an interesting premise and i do want to comment on the premise before we get to answering your question so uh i think high inflation is i agree is obviously bad because the it's very hard to predict uh things in it you know make proper spending decisions in the future if the value of the asset that you're saving uh is depreciating in twenty percent a year fifty percent a year it's very hard to uh accrue purchasing power over time right like say as you said there's no incentive to save whatsoever and i think if we think about incentive to save uh what is an incentive to save it's uh looking towards the future right and when there's high inflation uh it's very hard to have a high time preference now when there's low inflation but not inflation when there's low inflation that allows people to both make uh decisions that are based on somewhat stable economic data uh but as well as that you know you have a a complementary the stability that comes with low inflation allows people to think towards the future more than in a high inflation environment now where i think i think it's very obvious that a low inflation environment is better than a high inflation environment but there is a very interesting question around whether a deflationary environment is better than a low inflation environment and this is sort of fundamental economic question perhaps one of the ultimate questions where we will find out if the market would prefer uh either a disinflationary and then at some point deflationary asset like bitcoin uh or whether the market prefers a true disinflationary asset like bit like ethereum uh excuse me a true deflationary asset like ethereum although i think under the current structure of the way the e supply changes based on demand for block space it's actually sort of reflexive so the idea that the price is going to stabilize over time not sure how likely that is based on the current uh minting schedule but uh if if we take your premise that the eth price has stabilized significantly uh relative to general purchasing power even if that's price in u.s dollars whether you can think about it as purchasing power against a basket of goods whether people would prefer to own a deflationary asset or a low inflation asset hard to say ultimately and this is one of the questions that we kind of highlighted uh in the article that we published before the replant uh started or the barn race started excuse me which is if over time the market prefers a a a harder asset than beans uh despite the benefits of the distribution from the senior edge and the competitive carrying costs associated with it perhaps it is uh a sub optimal currency compared to bitcoin or at the year once those prices have truly stabilized but that's something that is going to take decades if not longer to happen and in the meantime there's very clearly a need for uh lower volatility assets than bitcoin and ethereum with competitive carrying costs so i i actually am going to kind of not answer this one and don't know what the answer to the ultimate question is i think we'll we'll find out uh collectively as a like a civilization over time uh but this is an economics question that the market's probably gonna have to answer uh in due time i i can't answer okay uh and i i agreed with you uh on the bits of a deflationary asset and you know holding it makes sense and do you think deflationary currency makes sense as can a currency isn't this opposite to what it's you know meant to be occurrence is supposed to be used so people you know will transact with it if it increases its value by doing nothing why would i ever want to use it well i don't i don't agree with the statement that the cur like currency uh you know is supposed to do certain things uh in practice the market has selected different currencies that have very specific properties uh but i think that the it's hard to i mean if we take a little bit of a step back here the introduction of bitcoin uh which what it really fundamentally did was allow for scalability of value across space and time in a much deeper way than gold in a previous sense and then ethereum generalized uh permissionless compute this is a whole new like one of the kind of guiding principles behind working on beanstalk is that this this technology this whole landscape is ripe for the creation of new money that doesn't really fit into or pushes against previous economic paradigms at a core level and so answering questions about is it better to have a deflationary or an inflationary currency sort of miss the point right the point is that the market is going to decide what is better and very clearly right now the market requires a low volatility asset and the only way to create low volatility is i guess without collateral is through inflation so then the question is what do you do with the inflation and if you look at a design like terra right the inflation from the demand for the stable asset all of that went to speculators in the value of luna not to the stable coin holders and that created perverse incentives that ultimately led to the system becoming way over levered with not enough liquidity not enough desire to hold the stable point itself and at some point it imploded but the question is really fundamental you can get the incentives right uh and in beanstalk there's very clearly an incentive to hold exposure to the stable coin itself uh and that uh the the rewards for holding exposure to the stable point are anti-reflexive meaning the the marginal benefit for holding exposure to the stable coin or purchasing additional exposure to the stable coin increases as the price decreases and decreases as the price increases or at least as much as possible on the latter end because you do have the inorganic demand problem but that's that's really the fundamental question beanstalk is trying to solve whether in the grand scheme of things over the scale of uh centuries the market will prefer uh a truly hard asset like bitcoin or a low volatility positive carry asset like beanstalk or beans very hard to say but i think that the the thing that we're working on right now is to create the best version of beanstalk such that it can stand the test of time and live for hundreds of years and ultimately allow the market to decide uh just like over millennia the market has chosen gold uh and chose silver to a large extent as well as the most uh marketable and most saleable goods uh to be used as store value and medium of exchange that hopefully if beans demonstrates sufficient robustness uh and low volatility in the bean price and competitive carrying costs that it it perhaps stands a chance at uh deserving a place in in the history books in the grand scheme of things from a monetary perspective but whether the market will choose a deflationary or an inflationary asset uh or an asset that doesn't change in supply like bitcoin uh hard to say hard to say what will happen okay we're going to build build up a little bit uh on this um now you know the bean right now follows the inflation of the use dollar so let's say you know it or tries to follow it at least so as a minimum as a minimum right so the bean supply actually increases with the inflation of the us dollar and the increase in demand for beans but yes i i meant as like you know if how how would being be used in an economy or in general if people like wanna you know spend it or not to more or less follow you know the us dollar because it follows the same the same you know inflation that it takes so let's say if we had you know a an if that bean stock issues you know another another being that is back to ethereum then that that would be deflationary as a single unit in its nature outside of what's happening what happens uh from senior rich um what i'm thinking uh right now is and following up on the idea of you know a little bit of inflation is good because you know it encourages people to spend what they're having and that you know stimulates the economy to an extent is how how can beanstalk do this to its own you know whatever is on the bean economy and for now let's take root as an example and maybe in the future it will be other other you know participants or other things on it what if we introduced a little bit of inflation to the senior edge in the silo and and this is how it would work so let's say you know someone has some deposits in the silo and then you you get 100 beans a scene rich binso could give you 90 beans and then it will give you 10 other beans that will you know get burned through time if you don't spend it and you can only spend these and you know things that are within the bin sock economy so let's say you get your you know your 100 beans you can you can you can do all or whatever you want i would just immediately interject and say beanstalk probably doesn't want to impose some sort of feed on people like this and additionally you know i don't i don't necessarily subscribe to the notion that you need low levels of inflation to encourage people to spend uh i i think there's some evidence to that extent but it's uh i think it's a more complicated problem than that and in particular when you're talking about building the bean economy the reality is that people are gonna the the benefits of holding exposure to beans in the silo uh are enormous particularly in the first couple of years of the system there's a lot of senior edge and the result is that it's very hard to take money out of the silo and do real stuff outside of the silo and compete with the yield from the silo the opportunity cost is too high and so the reality is that in order for there to be a bean economy what you need is for people to be transacting in deposited being right so everyone is constantly earning the senior ridge in real time and transacting in beans and that is where and you alluded to it root is particularly exciting that's because that is an implementation of markets for deposited assets so the starting point is people have these deposits they want to start to do things with them whether that's bend them uh they want to spend them at the very last minute and they want to spend them uh you know they want to spend their beans they don't have to sell them into eat and then into usdc and use use dollars or they want to just use their deposits at the very last second uh you know you need you need you need people to start to accept the deposits on both that's what when you talk about a bean economy i think that's where things get more interesting as opposed to imposing some sort of artificial cost on people for not spending their beings that would be my reaction i i agree i mean i i have also reasons to why in the long term this doesn't work i was worth thinking of the idea of stimulating if we choose you know uh to simulate our own uh let's say protocols then would that work it might work but i think it's a little cheating it is and um um you know it's it's encouraging people to do something versus done holding it and in the long run anyways the stimulus eventually gets translated into an increase in price so you stop having you know that short term productivity and it just gets translated into higher prices and you stop there okay thank you thank you for having uh this discussion and maybe just if we go back to the comment earlier about new tech being built on ethereum you've never really had the opportunity to hold dollars in a bank account and earn interest on them that is the result of senior rich from the printing of new us dollars you know so in the past you can either hold the deposits in the bank account or you can spend them this is really the closest thing to a new digital version of that where you're earning the most competitive risk-free from the you know assuming you're taking on bean stock risk the risk-free rate of return the bean stock native mint minimum rate of return you're earning after being in the silo that's that's like the the the the starting point for a new economy you know you need that before you can anything else okay um that's it from my side i also don't don't see questions on the on the town hall chat so give it a minute or two if anyone has another question i see max was typing one so maybe we'll take that is following up on the being if pull yes we we discussed that and the plan is to hopefully uh launch a being if pull on the beanstalk decks and correct me from wrong problems we're looking at end of q3 or maybe early q4 yeah definitely that's a short-term priority not sure exactly when that will be but i think ending q3 early q4 is is very reasonable maxwell asks the usd analog to transacting inside of beings would be like paying someone in u.s tragedies more or less do you think uh i think would be closer to trading bank deposit right where you're earning the interest on your deposit account until the very last second but it's also not it's also not unlike trading treasuries had smith asks where can i find more info on the decks plans so we've earlier discussed it on the six month road plan which was uh you know pre-exploit will probably there's nothing you know new discussion there but there will probably be you know more info coming out soon yeah i think it's it's one of those uh things that will will as opposed to like one big thing it'll just be a bunch of small things that over time comprise the market so you know the the market is pretty limited at the moment right now you can just trade pods but over time it should support a bunch of different stuff all without these all right i think we reached the end of the questions we we might end uh class here publishes that that's okay with you perfectly uh okay with me perfectly okay with me this is the it's all all very exciting stuff so we've got the dow meeting on thursday the vote ends on friday replant god willing on saturday uh this is all very exciting so uh if anyone has any questions about replant or anything like that uh in the meantime between now and then definitely shoot us a message in general or the questions channel happy to answer any and all questions and very excited to get this thing back back up and running very very excited same here and just to remind everyone there is no action needed uh from from really planned to unpause except picking picking your beans if you want to take them and you know deposit them into the silo is that correct yes and then after replant as fertilizer is sold and people receive revitalized stock and seeds they may want to figure out a cadence to enroute their revitalized assets uh that that that uh that's the one manual behavior that's additionally introduced in addition to the mo and plant yeah that's that's again or similar to farming stock uh pre-exploit yeah you can think of it like that to challenge there okay i see james typing he asked if we hit 50 column i don't i don't think we've hit it yet but you'll know once we do i think that the b i'm checking the discord bot it says 49 almost almost there very cool very cool very exciting guys it definitely is all right thank you everyone for for joining class thank you publius once again for taking time and we'll see you in the down meeting and then next week's class take care