📖

Beanstalk University Class #41

Date
September 6, 2022
Timestamps
0:00 Introduction • 0:30 A month in review • 7:15 How does Publius feel about 22% of Fertilizer sold? • 8:40 Chop bug within Beanstalk. • 11:50 How is Publius doing? • 13:26 Updates on future BIPs • 16:11 What are Publius’ thoughts on the OTC deals going on? • 20:05 What is the thinking around the number of seeds per BDV for the BEAN:ETH pool? • 22:47 Putting a cap on the amount of grown Stalk per Seed • 26:17 Will the AMM be audited before it goes live? • 26:51 Any updates on Stalk being liquid? • 28:02 Is it possible to pay ETH gas in BEANs? • 29:16 Will changes to Seeds affect previous Silo depositors? • 30:11 Will the AMM have a whitelist? • 33:14 How does Beanstalk react to USD devaluing? • 36:07 L2 deployment • 39:19 What parts of Beanstalk would be deployed on Beanstalk? • 40:26 Will Beanstalk ever have its own chain? • 42:54 What challenges are associated with starting a Bean chain? • 44:31 How will Beanstalk gain more engineering talent? • 47:10 Can Beanstalk issue other pegged assets? • 50:22 What are some low-hanging fruit ideas that can be built on top of Beanstalk? • 52:09 What can the community do to keep this momentum going? • 54:42 How has Beanstalk performed compared to the general markets? • 56:56 Closing statements
Type
Beanstalk University

Recordings

Notes

A month in review

  • The past month has been quite exciting when you consider that the ultimate plan of the DAO to restart Beanstalk was effectively the riskiest plan in the short term, but maybe the least risky from a long term perspective.
  • The plan to keep all the old debt, issue new debt, and scale down the supply significantly put Beanstalk in a position where it was an open question how the market received it.
  • The growth in market cap from the low $20Ms to the low $30Ms in the first week and then stabilization in the low $30Ms thereafter has been a very promising first sign as Beanstalk starts to redemonstrate itself as credit worthy.
  • Soil being purchased despite decreasing temperature indicates there is demand to lend to the protocol.
  • All things considered, it has been a calm first month, and no news is good news on that front.

How does Publius feel about 22% of Fertilizer sold?

  • The current structure is such that Beanstalk really doesn’t care how long it takes for all the Fertilizer to be sold.
  • As expected, the demand started to evaporate after the humidity decreased.
  • Whenever all of the current Fertilizer is paid back, at that point it will make sense to purchase Fertilizer again.
  • We probably won’t see too much more participation in the Barn Raise in the foreseeable future, but nothing out of the ordinary on that front at the moment from our perspective.

Chop bug within Beanstalk.

  • Halborn alerted us to a vulnerability in the chop() function that needed to be fixed urgently.
  • The BCM moved quickly to remove the chop() function, with the time from being alerted to removing the function being about an hour and a half. Very encouraging to see such fast turnaround.
  • The function will be reimplemented after Halborn signs off on the fix.

How is Publius doing?

  • Doing great. Excited that the protocol has been on for a month.
  • Very enthused at all the work there is to do. Thrilled to be working with entrepreneurs and developers building things on and around Beanstalk and the Silo.

Updates on future BIPs

  • BIP-24 is being audited, so hopefully it will be ready for proposal within the next couple weeks.
  • Originally the plan was to have the AMM ready for audit sometime in the next few weeks, but we’ve come to realized that we need to take more time and develop a more sophisticated oracle system.

What are Publius’ thoughts on the OTC deals going on?

  • Over the counter trading is common in any market where there isn’t a liquid exchange, and even common in some markets where there are liquid exchanges. So in practice, there’s nothing wrong with it.
  • OTC trading comes with a lot of additional risk, as we saw a while back with a user being defrauded out of 50k pods.
  • Want to urge people to be careful to minimize counterparty risk.
  • The difference to Beanstalk itself (compared to users chopping) is marginal.

What is the thinking around the number of seeds per BDV for the BEAN:ETH pool?

  • In the long run, it makes sense for the Silo to use a Stalk gauge system, where the DAO sets desired exposure percentages and the Seed rewards are derived from that, rather than the DAO voting on the number of Seeds per BDV for each asset.

Putting a cap on the amount of grown Stalk per Seed

  • From Beanstalk’s perspective,. the linear growth of Stalk doesn’t matter over shorter periods of time. It’s unclear whether over decades it becomes an issue.
  • The question is at what point does the opportunity cost from forfeiting Grown Stalk from Seeds become great enough that there is no need to issue additional Grown Stalk from Seeds.
  • Hard to measure where that would be, but it probably warrants more thought and discussion. It’s an interesting idea.

Will the AMM be audited before it goes live?

  • That is our hope. Technically somebody could propose a BIP that hasn’t been audited, but from our perspective it would be prudent to have it audited first.

Any updates on Stalk being liquid?

  • Not from a timing perspective, but it would likely be a part of the overall Silo upgrade that includes the Seed gauge system. Probably a couple months away.

Is it possible to pay ETH gas in BEANs?

  • Yes and no. No because in order to transact on Ethereum you need to pay gas in ETH. It could be possible, although the initial purchase of ETH with BEANs to facilitate the rest of the transaction would require ETH itself. But there might be ways to work around this.
  • Ultimately more of a UX question than a Beanstalk protocol question.

Will changes to Seeds affect previous Silo depositors?

  • It would likely affect everybody equally, but there are implementation details that need to be worked out.

Will the AMM have a whitelist?

  • Assets will have to be whitelisted for the Silo, otherwise outside entities could arbitrarily mint their tokens and manipulate their share of Bean seignorage.
  • Hopefully many assets will still be encouraged to use the AMM to take advantage of the zero fees and Bean liquidity.

How does Beanstalk react to USD devaluing?

  • It could act as a tailwind for Beanstalk, because it could limit the amount of value that Beanstalk has to attract to remain at peg, and reduce the cost of its obligations.
  • Less likely in the short term for that to play out, because BEAN trades exclusively against other USD denominated stablecoins, but perhaps over the long term a devaluing USD is good for Beanstalk from a macro perspective.

L2 deployment

  • Focus remains on the L1 deployment of Beanstalk, with so much development still taking place on L2s. Taking a bit of a wait and see approach regarding the L2 landscape.
  • It’s likely that a v0 of a Beanstalk layer 2 deployment would center around the fungible Silo deposits introduced by BIP-24.

What parts of Beanstalk would be deployed on L2?

  • There wouldn’t need to be anything from Beanstalk deployed on the L2, because all the Silo interactions would still happen on the L1.
  • The question is what would the L2 assets be used for, and that would require either the integration of the fungible assets in existing DeFi protocols, or the deployment of a new Beanstalk specific DeFi protocol.
  • For the time being, the goal is to keep working on Beanstalk itself on L1.

Will Beanstalk ever have its own chain?

  • Might not be a good answer for this. It relies on a philosophical question of whether the asset securing a chain should be distinct from the money of that network. In the example of Ethereum, especially when it moves to Proof of Stake, ETH will be the asset that is providing the security for the chain exclusively. We saw that with the Terra collapse that the security of the blockchain was compromised when the price of the Terra asset started to collapse.
  • At scale, if the majority of stETH is in the Silo, it might still be a problem that major decreases in the price of BEANs might cause a reduction in the cost to attack the network, but it still might be better for those risks to be abstracted to a different layer and a different currency with a different value proposition.
  • It’s a question we will likely revisit many times if Beanstalk continues to do well.

What challenges are associated with starting a Bean chain?

  • The actual implementation of an L1 is a massive task.
  • It’s more likely the DAO would want to transition to an L1 that has already been developed.

How will Beanstalk gain more engineering talent?

  • Beanstalk has attracted high quality engineering talent, and hopefully it will continue to do so for all the same reasons. It’s fast paced and intellectually stimulating to work on and there is a possibility of significant monetary gain in the instance that the protocol works.
  • The main concern is attracting engineers to build on top of Beanstalk, as opposed to Beanstalk itself.

Can Beanstalk issue other pegged assets?

  • As long as the credit of Beanstalk is strong and it can continue to attract lenders, there’s no reason that the protocol can’t issue assets that are pegged to different assets in theory.
  • In practice, it can be more complicated given that assets are expected to gain or lose value at varying rates. It is much different for Beanstalk to issue assets that are expected to increase in real world value as opposed to those that are expected to decrease in real world value.
  • The question is which assets would it be appropriate for Beanstalk to issue against. It is reasonable to expect that the more diversified the basket of good that Beanstalk has exposure to, in a similar way to the more diversified the liquidity that you trade against, the more resilient the protocol is and similarly the more diversified the obligations of the protocol are the better off it would be.
  • Probably not going to be something that happens in the near future. The market demands dollars on chain by a wide margin more than other assets. But if the market demands other assets, it seems Beanstalk could fulfill that demand as well using the same credit history.

What are some low-hanging fruit ideas that can be built on top of Beanstalk?

  • The existing segments of DeFi that have already demonstrated product market fit.
    • AMMs
    • Money markets
    • CDPs

What can the community do to keep this momentum going?

  • Important to remember that Beanstalk has gone through many waves of significant inflows and significant outflows and then long stretches of equilibrium where there are neither.
  • Not as important to build momentum as it is to continue to demonstrate efficacy.

How has Beanstalk performed compared to the general markets?

  • Relative to the market conditions, particularly the algo stable market conditions, things are going great. It’s a question of what you use as your benchmark. Speed is not the goal. The goal is to build the best tech and let it sort itself out.

Transcript

how are you Publius doing quite well mod how are you I'm very well uh I apologize for uh any potential background noise on this end I'm not in the quietest spot unfortunately sounds good to me so that's fine I also apologize um for any inconvenience on starting this class later than the usual but here we are Publius I wanted to start maybe this class by looking back into it's exactly a month since being sucks on pause and we have a little bit of more data that we can look back into and and see you know how the protocol has performed you know since since unpause and I'm going to go through you know quickly a few things and maybe we can discuss what what we think is a bit interesting so a month since unpause being respect the bean Supply on unpose was at 23 around 23.6 million it's at 31.5 million so we've had around 7 million of an uh an an extra let's say increase in supply has been and that's around 25 percent of the total Supply when when being so composed what what do you think about that uh in specific uh um since you know just the bean Supply increasing at that rate in one month so the I'm going to take the numbers that you gave as accurate uh although I I didn't check them in advance so assuming that they are accurate in terms of the supply growth the the past month has been quite from our perspective quite exciting when you consider that the ultimate plan that was decided on by the Dow to replant Beanstalk was effectively the riskiest plan from a peg maintenance perspective but the in the short term let's call it but maybe the least risky from a long-term perspective because of the fact that as was spoken about prior to the replan the current plan was sort of throwing the protocol to the wolves and with keeping all of its old debt issuing new debt scaling down the supply significantly that put Beanstalk in a position where it was a an open-ended question as to how the market would receive it and in short the the the growth in market cap from the low 20s to the low 30s in the first week of replanting and the stabilization in the low 30s thereafter that's been generally a very promising first sign uh as being stock starts starts to redemonstrate itself as uh credit worthy so from our perspective this is still very early days uh to some extent the fact that the protocol does not have uh on-chain governance yet means that the real Lindy effect for beans becoming money still probably hasn't quite started uh taking hold yet so there is still a lot of work to be done to continue to improve the protocol to get it to a place where uh the Lindy effect can really start to take hold because structurally there aren't going to need to be major changes to the to the protocol at some point so the first month generally pretty exciting other things that in our opinion were they are generally how the the demand for soil has been that it seems that every season all of the soil albeit very little uh has been sown indicating that even as the temperature continues to decrease there is demand to lend to the protocol the fact that there's so little soil on the one hand means that the effective temperature received for Lending so the protocol is actually lower but it also means that perhaps the data in terms of sample size isn't large enough to for being stuck to really evaluate what the optimal weather should be but nonetheless the the fact that the protocol has not issued a significant uh increase in the a significant amount of debt we should say that's generally an indication that the current and updated soil parameters are are generally doing pretty well so All Things Considered this has been a relatively calm uh first month and no news is good no news from that perspective so being stopped continuing to oscillate the bean price above and below the peg it's pretty pretty good from our perspective and there's been a little bit of upside volatility upon replant there's been a little bit of downside volatility in the weeks thereafter but generally things have been pretty pegged so I think it'll be interesting to see at some point once there's a liquidity trading against eth how that contributes to the volatility and the bean price because right now trading against stable assets there's basically no look no no no volatility we should say so that's that's some preliminary analysis uh there there haven't been any chops uh yet so perhaps the there hasn't been any sort of capitulation from older uh participants in the system that they want to just take their money and leave which is very interesting uh from a behavioral perspective in terms of confidence and willingness to wait so all very interesting stuff to to look at and generally the fact that the protocol is on and healthy after a month is very exciting yeah um and the major the beanman sort of the increase in being Supply comes from a few sources um one of them is due to the the shortage let's say of beans in the liquidity pool and then from recapitalization of selling third and then lastly from you know budget budget wins but the majority of that are estimated at around 80 percent or so came from a short stripping so being segmenting and distributing uh those those beans I I know that you described it relatively calm and it may seem calm but to me that's a big increase in Bean Supply and having the Pod rate relatively unchanged is is is quite impressive in my opinion expanding the supply to that to that point and at the same time still maintaining or not you know taking any uh amount of debt to absorb let's say any volatility that's in the system well I think maybe the reason to classify it as calm is because the initial growth in the bean Supply was and it wasn't sure exactly it wasn't determined to what extent the bean Supply would grow but the fact that the protocol replanted with a price above one uh did mean that there was going to be some minting so perhaps on this I'm not as impressed with the growth in the bean Supply but certainly are impressed by the low volatility in the peg process yeah and with 22 percent a third sold how how do you feel about that well the current structure of the barn race is such that Beanstalk really doesn't care what the the how long it takes for all of the fertilizer to be sold as sort of expected the the demand for fertilizer really started to evaporate as the humidity decreased and that makes a lot of sense uh there was a little bit of demand for soil with the very high humidities after replant uh but thereafter there was a major drop off in demand for fertilizer and that was pretty much expected and the thought being that whenever all of the current fertilizer uh is paid back and fertilizes all of its Sprouts at that point it'll once again make sense to purchase fertilizer so for the time being no surprise or uh change in expectations on how things are going in the barn race front the expectation is probably that there won't be too much more participation in the barn raids for the foreseeable future but uh nothing nothing out of the ordinary on that front at the moment from our perspective all right okay let's let's move to another um topic or an update that has happened the past few days which which is um let's say a bug or a potential exploit that halbern has uh found or assessed Publius can you give us a summary of what was that exploit uh and you know how how did we come to know about it and then what actions are taken and will it you know how would that also impact the protocol in the future sure so to be perfectly Frank uh since we were made aware of the bug I personally have not had a chance to look at the bug closely so I'm to some extent uh ignorant of how the bug worked uh but what I do know and can comment about is that the vulnerability had to do with the chop function and in practice what happened was that yesterday uh midday Melbourne alerted uh in the the Beanstalk slack uh where they they do their their Communications around the security audit uh they notified uh everyone in the channel of a a vulnerability and that the vulnerability was needed to be fixed urgently and that these vulnerability was in the chop function and so in response uh the BCM moved uh to as quickly as possible removed the chop function from the contract which uh in total I think from the time that halborn notified the slack of the issue until the BCM removed the function and therefore remedy the issue or at least remove the issue uh was about an hour and a half turn around so generally that's a that's a pretty good turnaround in terms of when you think about the current structure of the ownership and control of Beanstalk uh prior to the exploit ownership was a hundred percent controlled by Publius and so the fact that the BCM was still able to act uh very quickly uh given the time-sensitive nature of the issue that was pretty encouraging and uh halborn was watching it in real time and uh then sent another message in the slack even before they could be notified that the function was removed that they saw it was removed and that all was clear so since then uh we've been coordinating with them on a fix to the issue uh the thought being that the BCM will re-implement the chop function as soon as possible but hopefully in the next 24 to 48 hours uh it'll be ready to go and once halborn signs off that will that will allow for the re-implementation of the top function and will the BCM need to introduce this as a bip or it'll just be pushed on chain uh as of now the the expectation is that the dip will just be pushed Unchained by the BCM as it's part of a bug fix okay all right let's take some of the questions uh that are in the town hall chat starting with arson's question who asks how how are you doing Publius uh I think we're doing great so for more perspective the fact that the protocol has been on for a month is very exciting and to be quite Frank we're very enthused at all the work there is to do so if you think about Beanstalk as a base layer or a base issuer of money for defy uh all ultimately the utility of that money will be facilitated through the integration of various Technologies with the silo because the competitive carry on beans comes from depositing Assets in the silos so from our perspective there's just so much to be done on on and around the Beanstalk economy that it seems like there's there's infinite cool stuff to build so uh how are we doing we're we're so thrilled to be having really cool conversations with entrepreneurs and developers that are trying to build different things on and around Beanstalk and The Silo so uh generally uh how we're doing tends to be highly correlated with how Beanstalk is doing and uh at the moment we're very thrilled with how how things have gone I'm glad to hear that I remember your saying of you know as long as being pegged all is well life is simple that way I agreed speaking of things uh that can be done on being soccer uh think think the word that is being going on Harry asks about bit 24 and bit 25 do you have any update so from a timing perspective on bip 24 uh that is currently being audited and so the unclear on exactly what the timing is but the the hope is by either end of this week or next week uh to have uh that audit stream on div 24 completed at which point in theory the bip should be ready for formal proposal now given that this is the first bib that has been audited by halborn not exactly sure on the timeline and the Order of Operations there around completion of the stream and getting it ready for formal proposal but the thought would be that'll be in the next couple weeks probably two weeks let's call it uh that that's our hopeful or expected timeline on dip 24 at this point I'm 25. that's that's a decks so the the timeline around the implementation of the the instead of calling it The decks I think it might be more accurate to refer to it as like a beanstalk amm because to some extent the pods already are part of the Beanstalk decks right so lots of different assets can trade on dexes uh the Beanstalk decks hopefully will support the trading of a wide variety of types of assets but the the wells uh which I think is what Harry was referring to with div 25 uh those will be at least to start between erc20 tokens and originally The Hope was to to have that ready for audit in the next two weeks but uh as we've continued to think about how best to implement be in stock native amms the the most important piece of the amm is how to implement the oracles for the amm specifically uh as it relates to conversions and minting uh for being stuck in The Silo and uh were probably inclined to spend more development time building a more sophisticated Oracle system for the beanstock amm system up front than to roll out sort of a preliminary amm and then upgrade the Oracle system over time so at this point don't have an exact timeline but uh hopefully in the next week or two we'll have a lot more content on the specifics of how uh the Beanstalk amm Oracle system should probably work all right you mentioned earlier that the chop function hasn't been used uh and I knew thought that that was an interesting Behavior we've also seen some OTC deals uh happening maybe I I have seen more of them let's say but I don't know exactly how much you know in total has happened or um when did they start let's say what are your thoughts in general uh on Odyssey deals and you know what do you think that impacts uh being suck in general so OTC or over-the-counter trading is commonplace in any Market where there isn't a liquid Exchange and it's even common in some some markets where there are liquid Exchange so in practice there's nothing there's nothing wrong with OTC trading and if you look at the history of Beanstalk there used to be it wasn't uh Super Active but there was an OTC market for pods in the Discord and it's worth noting that uh one of the members of the community and again I'm sorry about the the background noise if it's particularly loud but one of the members of the community was actually defrauded using the OTC Cloud I wanted to play some lost something like 50 000 pods if I recall correctly so OTC trading comes with a lot of additional risks relative to trading on chain but it can be helpful uh to get liquidity if there's no liquid on chain exchange so uh I think the we would just use this as an opportunity to caution anyone trading OTC to to be sure who your counterparty is or to try to minimize counterparty risk as much as possible and recognize that the risk of trading OTC are significantly different than the risk of using an on-chain exchange or even an off-chain exchange and do you think that Odyssey deal is happening generally happen are favorable to the protocol so you know moving uh those those assets from one person to another who's buying it does that kind of like you know flush the system to an extent so on the one let's compare user behavior on the one hand if someone were to chop and liquidate their assets they're basically uh collecting value at the moment which would be its cell pressure for beans in the short term but minimize the long-term need for being stopped to recapitalize itself and so there's some sort of trade-off there from beanstalk's perspective where on the one hand it's short-term value leaving the system uh in exchange for the the decrease in need to create longer term value let's call it so the the future obligations of the protocol are lessened uh if people chop so Beanstalk is perfectly comfortable if people chop but on the other hand if somebody wants to buy the unripe assets and therefore hold it longer than the person that would have chopped it so they're providing some liquidity uh instead of to the person who was going to chop the only difference from beanstalk's perspective is that it's total future obligations are greater uh if less access are chopped and so yeah the margin it probably doesn't make a difference to the protocol one way or another and it is this is a good time to just restate that Beanstalk is designed in a way where it assumes people are acting in their own best interest and not in the interest of the protocol and whether people are chopping or trying to liquidate their unripe assets on a secondary Market it doesn't really affect Beanstalk and that's in line with that design choice or design goal we should set okay Austin asks what is the thinking for the amount of seeds to be awarded to the beanie pool will it be more than the bm3 curve for instance five seeds so on the one hand frankly having given too much thought to the seeds per bdb for the beanie colas compared to the bean creaker pool but the reason for that is that over time and it's unclear exactly when this should happen but it probably makes sense to if the seeds per bdv system to not be the thing that is set by the Dow but be a derivative of the thing that is set by the Dow So currently the Dow determines the seeds per bdv which is basically the relative payment in Grown stock for a given deposited whitelisted asset and that's that's fine but in theory it may make more sense for the Dow to uh set Target percentages so of the assets that are whitelisted for deposit in The Silo instead of setting seeds for bdv it may make more sense for the Dow to set desired exposure percentages where it could be 50 each and fifty percent three curve and then the way The Silo would work in terms of seeds per vdv is over time if there's too much exposure to three curve and not enough exposure to eat then the ratio of seeds per bdv should increase for eat and decrease for three relative to one another to increase the the desire or the attractiveness to hold each exposure within the silo so it's therefore the seeds for vdv become a derivative of what the Dow absolutely cares about which is exposure to any given cryptocurrency so not sure on timing for when that will be ready to be implemented and uh it's probably not going to be ready prior to the the first couple of Wells that are ready to roll out like the bean eat well so it at some point it probably will make sense to have that conversation when seeds per vdv bdb for the Bean eat pool relative to the bean 360 but I haven't given it too much thought I like I like the thought of this so some sort of balancing mechanism um that adjusts basically uh the liquidity according to what the Dow has decided initially I think that'll be interesting to see it in action with the amm as well okay building up on the seeds question um not don't remember who said who's asked that or where did I see it but what are your thoughts about putting a cap on the amount of stock that a seed can grow so well first off I've never really considered that so I'm thinking out loud here but first off there is no From beanstalk's perspective the linear growth of stock from seeds doesn't um it doesn't it doesn't matter over shorter periods of time it's unclear whether over decades it becomes a an issue so the concept the real question being asked is is there a point at which the opportunity cost from forfeited grown stock from seeds becomes sufficiently large uh such that there's no need to issue additional grown stock from seeds and I mean the first reaction would be that there probably is some point at which that is the case but it's not clear how to easily have beanstop and measure what that point is and therefore for the time being probably it probably doesn't make sense to implement the cap on the grown stock per seed uh or per bdv but it's it's something that probably should warrant some more thought and discussion it's an interesting idea yeah I think the challenge with a cap on on the Seas is that you know the percentage of people who have or the participants who have reached the maximum amount of stock that can be grown will not have much of an incentive to participate and convert um maybe not so true uh but you know they want there is no you know point in getting forces or two C's because I've already maxed uh uh What uh what I've cut well I think that well it's not untrue I think that that's a type of friction that should get resolved through the auto the auto seed adjustment system whereby then you know if there's an unwillingness to convert Beanstalk should be able to work around that by adjusting the seeds for b2v but your point is well take on the other the other part of let's say there is a lot of stock concentration on the undersado is not attractive anymore I think that the system will balance itself as well if it's really done attractive then you know naturally people will leave as that growing stock doesn't doesn't uh add that much and there will be some balance point but I agree with you maybe some more thought put into this could could get up some better ideas the answer for this will really play out is the bank run right in a heavy Bank Run uh how does the fact that you have capped the grown stock on seeds affect people's willingness to stay in the system that that's uh an open question but uh that would probably be the one to primarily consider agreed agreed since this is the purpose of the seeds to begin with Thunder record asks if the decks or the amm contract could be audited before it goes live that is certainly our hope uh so from our perspective it it would be quite prudent to have halborn uh audit any of the the bips prior to proposal now there's nothing that can stop anyone from proposing a bip that hasn't been audited but from our perspective it would certainly be prudent to have it audited first Canadian Bennett asks if there are any updates on stock being liquid so not not from a timing perspective other than perhaps that the liquid stock and liquid seeds because you you you can probably make seeds liquid in a non like a either an 1150 five or where where you have different seed feed types depending on the asset that they're associated with uh both stock as an erc20 and Siege as an 1155 potentially uh could be implemented around the same time that the variable uh the variable seeds per bdv system could be implemented let's call it so this is all part of a seed liquidity stock liquid energy the the updated Gates I don't know if you want to call it a gauge system but a seed gauge system that's all part of like a silo V3 and uh not I mean maybe it's not a silo V3 but it's probably a couple months away the shirt is uh a lot of work to be done it asks is it possible to use the positive beings for gas and I'm assuming you really really mean that the user just signs the transaction and then bin stock uses their deposits as gas and you know push push things on the blockchain so yes and no uh no because at the end of the day you need it to to transact on the each Network and therefore you need some base to facilitate the sale of beans into youth to pay the gas fees but yes from a ux perspective you could in theory facilitate the sale of beans in to eat to pay the gas but it's unclear that would actually be the best ux because of the gas be associated with the sale of beans into each so it may not make sense to do it every time uh but that that's more of a ux question than it is a a beanstalk protocol question because you still need to transact on the ethereum network it probably becomes easier to do that once there's no withdrawal Freeze from Silo Austin asks a follow-up question on the seeds discussion if any changes let's say that happened to the seat system whether it's the gauge or or anything else how would that impact existing uh um let's say stockholders or or will it only impact new new ones uh the expectation would be it would would affect all the pot all deposits it's unclear in exactly what capacity for example One open question is whether uh stock and seeds for bdv and bdv only update upon interaction with the silo or every block or every season uh things like that have certainly not been ironed out so it's hard to say more specifically other than the expectation would be that every deposit would would be part of the system now or every white listed asset the next question asks if the amm is going to be a general purpose amm or only for some you know white listed assets let's say or selected assets so at the end of the day this is for the market to decide Our Hope and expectation would be that because beans are positive carry they present a very attractive asset uh to trade against and therefore it may be very attractive for other protocols to have a whitelisted bean pair in The Silo but on the other hand it's not possible to have like an open white list because somebody could create their own cryptocurrency uh and then basically use use their minting ability or control over the currency to manipulate their their share of the senior age from Beanstalk in practice because if they control all of the supply of the currency and they have lots of beans they can regulate the bdv of their currency pretty heavily and therefore manipulate the silos so the the thought is the whitelist will still have to exist but the hope is to implement this the the system in a way such that lots of different assets can trade against being take advantage of the the zero fee amm and maybe maybe just as a commentary note uh in practice utility for trading on an exchange isn't just a function of trading fees it's also a function of uh liquidity depth because if if there's not a sufficient amount of depth of liquidity the price slippage is gonna also factor into your effective price and uh that's also not good so it's not just about zero fees it's also about having deepest liquidity and and the that that's where implementing a world-class amm uh in the spirit of the Pod marketplace where there's arbitrary curves that people can place place bids or offers at uh that's something that's very exciting to us and we think that that can can help make the Beanstalk amm really robust to attract liquidity for not just a couple uh trading pairs but lots of different trading pairs foreign did some examples uh or numbers calculating how having no fee versus um a much larger liquidity pool um how a small one with a smaller one but without fees would compare or be more efficient to it do I remember the actual numbers but they were quite eye-opening and to add to that as well anyone will be able to you know have a well and it doesn't have to trade against beam but the wells that will be in The Silo are only the ones that are whitelists so not every while that's on the mm will be whitelisted but anyone can can start their own sweetheart beans asks what do you think about being stuck in the contents of devaluation of the USD I'm not sure if I understand this question maybe it means as the U.S dollar devalues what what does how does bean stock react so I think you're correct generally an inflationary environment for the US dollar serves as a Tailwind for Beanstalk because if you think about the outstanding I don't know if liabilities are the right way to think about it but that yeah the outstanding obligations of Beanstalk as the bean the USD value of the beans at Peg the concept is that as the value of USD devices that should make it easier for Beanstalk to attract uh enough value to keep the beans at their pet so in practice it's unclear how much that act actually plays out uh right now the fact that beans trade exclusively against other USD stable coins means that it's less likely that beanstar actually feels that Tailwind uh in the short term but perhaps over the long term uh a deep devaluing US dollar is still from a macro perspective good for Beanstalk because it's it decreases its obligations uh the the main the main question from beanstalk's perspective is just what is the what is the value of the liquidity trading against beans and the the ex the current equilibrium price in those amms so as beans start to trade against other assets uh particularly assets that may uh demonstrate devaluation of the US dollar through the increase in dollar value of their prices at that point you might expect Beanstalk to experience more short-term Tailwinds from the devaluation of the US dollar so the introduction of a being eat pool that would probably be the first step in having Beanstalk benefit a little bit more from the devaluation of the dollar and then perhaps having beans trade against uh more real assets that's really at the point at which you would you would start to see Beanstalk experience uh more and more of those Tailwinds so the more assets that being trans that will reflect the devaluation of the Dollar by increasing dollar value that that's how being stocked most most clearly benefits um sweetheart means those sufficient answers or if it wasn't uh let us let us know and we can expand on it and he sends a thumbs up being bang bang refried asks what are your thoughts on L2 deployment at this time and if it's not anytime soon then what Milestones do you think it would be to then consider an L2 hey sorry I I booted Myself by accident um the the short answer is that the exact timing on L2 is unclear particularly because there's so much development happening on L2 at the moment and the the optimal strategy for being on l2s still really hasn't quite presented itself particularly because just the potential for how a zero knowledge a zero knowledge L2 really affects Beanstalk is so profound that it's almost like you know it's hard to focus on short short-term short-term L2 Solutions because it's almost a distraction there's enough work to be done on L1 being stopped that waiting a little bit for for a little bit more development on the L2 side is an attractive thing to do but with that said there's actually a uh optimism happening next Monday so uh perhaps and I think the thought is now now that Beanstalk is back on sort of recommends conversing with various l2s and see their interest in Beanstalk and uh kind of take it from there so there hasn't too much there hasn't been too much uh thought on that front to be to be cranked because there's so much to do on L1 and the L2 deployment is is we don't expect it to be particularly complicated the main question at least at the moment is around how to ensure that there's liquidity on the layer too and I'm going to talk a little bit more about it the implementation of bib24 is really the first step in uh the direction of having a fungible version of Silo assets and the the thought is that it's it might make the most sense to have Beanstalk uh try to attract liquidity for specific fungible versions of deposited assets on the L2 so that people can carry uh they can have beans with the Positive carry on the L2 and then from an implementation perspective there shouldn't be too much complexity around bridging your beans to an L2 adding them to a liquidity pool on the L2 and then uh bridging those LP tokens back to layer one to deposit them into silos so that's probably what the the v0 of a layer 2 implementation looks like uh for Beanstalk but it's it's definitely still a waste away follow up to the question from us and asks what will actually get deployed on an L2 so why L2 yeah so in in in the version of an L2 integration that we just described there wouldn't there wouldn't need to be anything specifically from a beanstalk specific perspective deployed on the L2 because all the style interactions would still be happening on L1 uh the question then becomes what are the L2 fungible assets being used for and that would likely require either the integration of the fungible assets into existing D5 protocols for the deployment of new beam stock specific D5 protocol but in terms of Beanstalk itself it was for the time being uh the hope is to minimize the amount of uh development that needs to actually happen on the L2 to keep getting Beanstalk itself on L1 for the moment okay and while while we're at layers NASDAQ asks when what about Beanstalk having its own you know chain being chained um that's a that's a great question one which perhaps doesn't have a good answer uh this speaks to the kind of a a first principles question as to whether it is best for the the asset that is securing the network to be distinct from the the money of that Network so in the case of the ethereum network particularly when it transitions to proof of stake e ther becomes the the asset that is providing the security for the chain exclusively and the I think in practice we saw that the security of the Terra blockchain was compromised when the price of the era assets started to collapse and Beanstalk is is designed to be resistant to Major Bank runs and short-term price collapses uh but it assumes the security of the ethereum network and therefore the time with which to operate to attract enough creditors to return the bean price to a dollar so that security assumption is jeopardized if the the the value that is securing the network is also the the currencies the the protocol is currency now it is worth saying that at scale assuming that the vast majority of either State Eve is trading against beans and in the silo you still sort of have this problem where a major decrease in demand for beans would probably resulted in a decrease in the price of ethereum and therefore uh a major decrease in the the cost to attack the ethereum network but perhaps those risks are still better abstracted at a different layer with a different currency with a slightly different value proposition than beans themselves but that is a question that will will likely be asked uh again and again in the coming years assuming that Beanstalk continues to do well what do you think are the challenges with something like that is it just because it may not be worth it at the moment or do you think there are technical challenges uh to to do something like that can you can you clarify what you mean I'm not trying to answer the question if let's say we decide or the doubt decides that hey let's start our chain can we do it but we only don't want to do it because we don't think it's worth it right now or you know we can't do something like that at the moment and it may take us I don't know like maybe like years to to get this thing uh up and running uh number one is a gargant mask and separate from the separate from the Dow deciding it makes sense to develop an L1 the actual implementation of L1 is is is a massive massive uh past and frankly in practice what's more likely to happen is uh the development of an L1 that that is is basically done and then the Dow votes to transition the state of Beanstalk to that L1 in some capacity but the concept of developing L1 in in advance uh you know it's just such a big project it's not it's not it's not top of mind at this point so for the moment at least it's it's hard to to see that happening all right now Zach Leslie asks how are you thinking about attracting more engineering talent to be in stock so frankly we think that Beanstalk has done an amazing job of the bar attracting high quality engineering talent and we we hope that for similar reasons it will continue to attract high quality engineering Talent so why do we think these Arc has attracted high quality engineering Talent thus far it's a combination of something very uh fast-paced and intellectually stimulating to work on with uh the potential for a significant amount of monetary gain in the instance that the protocol works and that doesn't that that that General proposition doesn't seem to be changing anytime in the near future and as far as we can tell uh development resources at this point are are not not really demanding holding back the development of Beanstalk developing good stuff takes a lot of time and it I think the the real question is how to start compelling Engineers to build on top of Beanstalk as opposed to being stock itself and uh more Beanstalk devs is great on all parts of the stack but uh perhaps the time has also kind of to start asking the question as to how to encourage attracting devs on top of Beanstalk and being browned in Mr manifold and to do a job of that but uh there's the reality is that as Beanstalk continues to prove itself uh we expect that more people will realize the potential upside if it works and uh re-evaluate the chances that that does happen and decide at some point it makes sense for them to start building on so economically we view it as somewhat inevitable assuming that Beanstalk needs to work that protocols will start to build on top of Beanstalk because in order to compete with traditional businesses uh protocols need to compete for traditional businesses to use them protocols need to use beans because of their positive carry so uh the short answer is at least for the time being there isn't there isn't much of an active uh movement to recruit new Dev Talent as much as there is uh a continued sitting process through the the many inbound uh interests in people looking to work on beans in some capacity to find people that are going to build really cool stuff Olson asks um how was your thinking uh changed about being success ability to issue other pegged assets besides you know being so there's a couple of things the first is that the as long as the credit of Beanstalk is strong the protocol is able to attract lenders there's no reason that the protocol can't in theory uh issue of assets that are paying to other denominations in practice if if the protocol can if the same Beanstalk is going to issue different pegged assets it's one credit history and so the price of of any one being whether it's a USB being or a BTC Bean or whatever have you they're all going to be highly correlated in terms of their relationships to them because they're all related to the same credit history or backed by this same threat so from that perspective there's the main question to consider there's some specifics on implementation which haven't been specifically worked out but the real question to consider is uh related to the question questions asked around how the devaluation of the USD of vaccine stock which is that uh issuing assets or obligations or liabilities however you want to think about it that are expected to decrease in real world value in the future is a is a different proposal From beanstalk's perspective than issuing assets that are expected to increase in real world value now what is real world value that's uh hard to define or say uh but it's I think that's really the main question is which are which which assets is it appropriate for Beanstalk to issue against and to some extent the the more Diversified the basket of goods that Beanstalk has as an exposure in a similar way to the more Diversified the liquidity that you trade against the the more resilient the protocol is uh you could make an argument that the more Diversified the the obligations of the protocol similarly the the better off at it so uh don't have too many specific comments at the moment as to when that makes sense to do don't think it's for the foreseeable future given that the market seems to at the moment still Demand by a wide margin dollars on chain more than any other asset but uh if the market demands other assets as well uh it it seems possible that being stopped could fulfill that thing as well using the same credit history foreign Hall chat assist with red beans is typing so give it a minute and see if there are more questions but sweet red beans saved his to next week Austin asks what if any are some low-hanging fruit ideas that you'd love to see built on top of Beanstalk the the low hang fruit and there's not that much of it to be frank or the current pieces of D5 that have demonstrated the products Market in so what are they we we would really classify them as three different things you have amms uh you add money markets and you have cdps so those are the the first three things that really make sense it's low hanging fruit to build on top of Beanstalk and then there's some higher hanging fruit like uh the idea for uh uh I guess it's just a part of the money market ultimately the mod present difficult classes back uh but more and more sophisticated implementations of amms cdps and money markets that's probably the lowest lowest hanging fruit where uh the use of them starts to become more attractive because of the senior age but the reality is that it's just those are the tools that have proven themselves as useful and D5 thus far and they do need to ultimately be built on top of beta stock so the implementation of each of the uh non-trivial in their own right in order to implement them as best as possible but those are probably the first couple of things to particularly if you're asking about low hanging fruit that's probably there I think this is what creates a mature market and I'm sure Market is what you know facilitates and enables utility um so as as these markets or things get built on top of it there will be more and more things that can be done you know in the economy Colby and x what what are the biggest things everyone in the community can do to help rebuild momentum so one thing it's really hard I think in the moment to remember but it's important to remember is that being stock has gone through from many uh waves of significant inflows and significant outflows and then long periods of basis or equilibrium where there's neither emotional outflows and the thing that from our perspective is most exciting is that if you look at the previous implementations of being stopped being in stasis or equilibrium they never were as positive from a uh stats perspective or a macro perspective in terms of the health of Beanstalk so uh from our perspective it's not so important to to to rebuild momentum as much as it is just important for the protocol continue to demonstrate efficacy but if the question around how to communicate the efficacy uh think that that there's a lot to be said for if you look at how for example the Pod rate has performed or the peg crosses have performed during other periods of stasis where there hasn't been demand or uh Supply changes in in beans in the demand Forest Supply of beans uh this is a pretty encouraging time so we were mentioned uh but but recognized that sometimes it can be hard to to to to remain patient so if there's a desire for people which is great to to spread the word um try to try to encourage to look again or take a first look at Beanstalk uh there's certainly a lot of data that can be used to encourage them to to do so so uh we're pretty enthused on on the momentum front even though it seems like things aren't nothing's really happening on the momentum front I think I think that might be a little bit of a misimpression given given that people have the memory of the pump for the month prior to the exploit and then the first couple weeks after the exploit it's it's hard to remember that this is actually pretty normal and the fact that the protocol is doing great when it's in such a normal State that's pretty pretty exciting so uh not sure if that's exactly the answer cool being looking for but hopefully it's it's some helpful color on on how we think about momentum hmm look on on Twitter or or generally speaking um most I see like a lot of the common common talk is that now is not the time you know to do much and and relax and just wait and observe on how you know the market is is behaving and the sentiment is not only in crypto it's also like in the overall in the overall Market itself do you not think and we go back again to what we discussed earlier at the start of this class uh which was you know how Beanstalk has performed in this past month given the market conditions and giving how the sentiment and where we're in do you not think that there is a lot of momentum with Beanstalk you know I use the word impressed I'm pretty impressed on how being success performed you know everything is relative and I think relative to how being so was doing prior to the exploit the momentum is not great but relative to the current market conditions the momentum really is great relative to the stable coin market conditions particularly the algo Stable Market conditions uh Beanstalk is doing pretty great momentum's doing pretty great so it's really just a question of what what do you use as your benchmark and I just I think it's good to read that one thing that we are not uh focused on is is is speed and the speed at which Beanstalk grows to 100 million or a billion or a trillion speed is not the goal the goal is to continue to build good Tech that uh whenever uh whenever uh there is demand because this is the best attack and and it makes the most sense to use economically that's that's really the thing that matters uh we believe that this will all sort itself out so uh we're patient uh and we think that just continuing to operate uh patiently and as safely as possible and continue to build the best attack possible that's that's really the key and and not focused as much on short-term momentum thank you Publius for that answer is typing if that's a question we'll take it as the last question okay another question thank you as always for your time uh to answering all of these questions and thank you everyone for joining us and we'll see you in next week's class thanks man