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Beanstalk University Class #47

Date
October 18, 2022
Timestamps
0:00 Intro • 0:27 Would it make sense to prevent converting above peg to target a certain silo APY in the future? • 4:19 Is it okay for the Silo yield to be different than the risk-free rate of Dollars? • 17:26 Would the Stalk system ever change the way Beanstalk mints? • 19:10 What are Publius’ thoughts on disabling converts above peg for Unripe assets? • 23:46 Any updates around Wells? • 28:03 What are some examples of Pumps that will be audited upfront? • 33:31 Is the protocol immutable? • 40:11 What is the difference between being at peg and being at pegish? • 41:11 What is the purpose of Beanstalk? • 48:46 What are Publius’ thoughts on the amount of centralization of the Ethereum network? • 51:22 Closing statements
Type
Beanstalk University

Recordings

Meeting Notes

Would it make sense to prevent converting above peg to target a certain Silo APY in the future?

  • Inflating the Bean supply is not always great/optimal for the system
  • There are certain instances where the Bean seigniorage can be put to great use
  • There is value in some guaranteed yield from the Silo
  • If people are using the non-yield bearing currency then there is no reason to encourage the yield bearing form of the currency

Is it okay for the Silo yield to be different than the risk-free rate of dollars?

  • From a competition standpoint if dollars are permissionless on-chain it would be hard to imagine people preferring Beans pegged to dollars over dollars. Right now there are no dollars on-chain.
  • You do not need the SIlo yield to compete.
  • The Field is close to the issuance of Treasury notes
  • Beanstalk cannot buy Pods on the secondary market
  • The Silo is close to a bank account in the current system
  • If the dollar was deployed on-chain it would probably be done in a centralized way
  • There will always be things that drive demand for Bean and other things that will drive demand for the dollar
  • Beanstalk does not have an obligation to mint, therefore if the price of Bean is below peg it does not need to mint

Would the Stalk system ever change the way Beanstalk mints?

  • The Stalk gauge system is more about the distribution of Stalk and Seeds for Silo deposits rather than the minting of new Beans

What are Publius’ thoughts on disabling Converts above peg for Unripe assets?

  • The goal of Beanstalk is a volatility damper over long periods of time
  • Short-term volatility is nice, but if there is too little volatility Beanstalk is doing its job
  • Do not think it is in Beanstalk's best interest in disincentivizing Converts
  • Because Unripe assets are pre-current Bean supply it is not allowing for real price discovery

Any updates around Wells?

  • There are a lot of different things to get done to get the Wells to where we want them.
  • Oracle (Pumps) are being put together as we speak
  • Wells will be able to have a certain amount of Pumps
  • Pumps will be able to be deployed permissionlessly
  • The hope is to have generalized audited Pumps

What are some examples of Pumps that will be audited upfront?

  • Exponential Moving Average, Simple Moving Average, etc
  • On-chain oracles are much more favorable than off-chain ones since we are only as strong as our weakest link
  • It comes down to, what on-chain oracle can we use.
  • Many factors will make up Pumps
  • A lot of experimentation is still yet to come with on-chain oracles

Is the protocol immutable?

  • No, the Diamond standard is not immutable
  • The real question is does Beanstalk need major upgrades
  • Well, Beanstalk is doing pretty good right now so maybe that Beanstalk does not need upgraded
  • Beanstalk runs in a competitive market so over time Beanstalk would get forked and upgraded
  • It is foolish for us to stop working on improvements
  • Many different entities are currently working on Beanstalk and it is very exciting

What is the difference between being at peg and being at peggish

  • If the deltaB is within 5 Beans then we are peg, if the deltaB is outside of that best case we are at peggish

What is the purpose of Beanstalk?

  • There is a difference between what the goals of Beanstalk are and what happens in practice
  • What happens is dependent on what the DAO decides
  • Publius thinks Beanstalk’s purpose is to make the best money ever
  • If Beanstalk is trying to make the best money ever, it is going to have to answer what does utility look like

What are Publius’ thoughts on the amount of centralization of the Ethereum network?

  • There is risk everywhere, it is very clear that Ethereum is focused on becoming more decentralized
  • Ethereum is able to support the most decentralization

Transcript

how's it going Publius what's up mad all all is well here how's everything with you another day at peg-ish but uh pretty good so uh you know generally doing pretty good yeah being the tag can't complain exactly keep it simple okay we can start with the first question uh that's from backrest and this is a follow-up um to a discussion from from last class and that has to do with you've floated the idea of you know if there's a possibility of a healthy being inflation uh I'm going to read back this question so he says last week you mentioned that there was probably some level of healthy being inflation where it wouldn't make sense for the protocol to incentivize converts above back the implication was that it might be a good idea to Target a certain rate of inflation or Silo yield is this something that could eventually become a parameter in the stock gauge system so there's a couple things to be said here the first is that it's it's unclear that well I think one thing that is clear is that inflating the bean Supply in all cases is probably not optimal for Peg maintenance uh there's certainly going to be some instances where increasing the bean Supply is not necessary or optimal for the system uh however there is probably there are certain instances where the senior age from Beans can be put to good use and perhaps it's as simple as derivatives existing on top of the silo where people can lock in their rate of return where you start to get some of the same benefits uh but there is there's certainly value in some guaranteed minimum yield from being in The Silo and it I mean have been thinking a lot about it don't really have anything articulate uh to say about it yet uh but I guess the question that's on my mind or on our mind uh around this that might it's related but I'm not exactly sure how it's why why is it that the federal government would prefer that we use dollars and not treasuries as the currency why not I think it's related right and there's there's some aspect of the requirement to pay back dollars is sub-optimal than just having people use the dollars themselves so it's one of those I think it's a good Gig if you can get it where if people will use the currency that isn't paying out any yield then there's no no reason to encourage people to use a yield varying yield bearing version of the currency uh but but that that doesn't really get at the issue that we were talking about last class around the fact that there is the potential to facilitate additional business that creates more demand for beans than were minted to facilitate that business whereby that minting is positive and perhaps again circling back to what we're saying today uh perhaps that's as simple as a a raid swap where you have fixed yields for holding Silo positions uh built on top of being stocked or perhaps there's something that can be more sophisticated done here but don't don't think I have too too much toward I'm able to articulate at this point on this map okay I understand that there are a lot of thoughts here on on I wanted to discuss maybe a few points just for the sake of um on discussion the first one is starting with the um the idea that you know a comparison between the yield and The Silo and let's say what's given you know in in the US dollar in traditional Finance do you see a resemblance between the two where they have to follow each other is it or are they are these two even though being respect to the dollar it is a separate currency or a different currency so it's okay for you know the silo to have a different yield than the US dollar and it's also okay for sometimes the US dollars to have a year that's higher than the uh then being itself even though that they're both packed so just because both are equal each other it doesn't mean that they're both functioning the same way and they're both you know used or utilized in the same manner so I feel like you're asking two questions almost the the first one which is a little bit simpler which is is it okay for The Silo yield to be different than let's call it the risk-free rate uh on dollars just because beans are pegged to Dollars uh I think from a competition perspective it's hard to assuming that dollars were permissionless on chain it's hard to imagine people preferring beans pegged to Dollars over dollars uh but right now there aren't dollars on chain uh now so so therefore do you need the salary to compete uh not necessarily because there aren't dollars on chain but at some point you may get there and at that point that goes into the more sophisticated question I think you're asking which is how to think about beans are being stopped and whether to compare The Silo to treasuries I think it's helpful to compare Beanstalk to the US dollar Fiat system because US dollars are by far the most successful credit based money that has ever existed and it's a model that should certainly be there's a lot to learn from the success of the dollar but now I think but kind of shooting the here making this up probably more reasonable to compare the field to the treasuries uh to the treasury market where or maybe not the treasury secondary Market but the the issuance of treasuries uh as closer to the issuance of pods in the field where you have the debt debt of the the currency issuer being minted uh and then there's a a healthy secondary market for treasuries which in practice then the dollars themselves are used to affect uh the treasury market which is where things get pretty circular and cyclical and uh hard to piece out separately but in beanstalk's case things are currently a lot simpler where the there is no ability for Beanstalk to buy pods on the secondary Market if that makes sense uh now perhaps I mean just talking out loud as I'm as I'm as I'm talking here maybe it makes sense if the if any pods are are at the back of the Pod line and listed below the current temperature it may make sense for Beanstalk to try to buy those when when beans are sown instead of burning those beans it may make sense for Beanstalk to buy Pods at the at anywhere in the wine that are cheaper than the pods that just issued and burned those pods so instead of burning beans it's burning pods uh that would be an interesting sorry to get so sidetracked but that would be an interesting thing to to talk to to think about from a a capital efficiency perspective when it comes to debt issuance uh but to get back to I mean the nonsense we were talking about before around comparing being stuck to the dollar system and trying to trying to draw some analogy though not to call it nonsense per se but that I think I'm making sense here uh the silo is is closer to like a bank account in the current system where you've got some balance uh of beans or currency that is earning yield and that yield is in some way funded through debt issuance although it's really funded through the economic growth that results from the debt issuance and there are a lot of parallels uh from an economics perspective with where the silo yield comes from and where the interest in a bank account comes from per se but it's not it's obviously not exact and then in the case of a banking deposit you have some counterparty risk to the bank unless it's FDIC insured and even then it's up to an amount whereas in the case of Beanstalk bean stock is at least in theory always can on or Silo deposits now you do have some exposure to the credit risk of being stock and contract risk as we learned in April but if if you're trying to kind of compare the two and you asked is there use in doing that uh definitely feel like there's use and if you're going to do it that would that's at least how we currently understand Beanstalk as compared to the the current Fiat system but we feel like we're learning a lot about both systems constantly so perhaps that analogy will change or become more refined over time and I guess just one more thing to tap on here is you know uh Bean is an erc20 token deployed on chain governed by a protocol you know Publius mentioned the US Dollars currently not on chain even if it were to be it would likely be done in a centralized way and thus it's hard to see you know kind of uh you know conceive of any future in which you know one being from a like what is this Val how is this like value actually controlled and represented not going to be correlated to the US dollars so there'll always be things that you know demand things that drive demand for being and things that drive to demand for the US dollar and I would imagine one would expect the you know current you know uh you know interest rates on each you know the relative interest rates between being in the US dollar to fluctuate as a function of that demand shifting from you know utility for being versus utility for the US dollar um and you know yeah I I think this is a a great Point uh Publius which is even if uh we have let's say uh the US dollar exists on chain again there would be different economies and they may perform differently and just because one aspect to the other that doesn't mean you know that one has to follow the other uh and it to me it is expected to have different yields and maybe one time one will outperform the other and and it could be that the other outperforms the other the question is in the long term I guess who who will Who will do that or who is the one to bet on and probably as I also agree that yes the field resembles the treasury in the sense on how it IT issues um that you you had a comment where you said why aren't treasury is used as a currency would that be because tragedy is unstable given that their yield fluctuates and that you know changes their prices and so on is that a reason I mean I would jump in and say here like you know it's they're you know they're not used because you can't um you know uh for whatever reason when they were created you know there is really no easy way to kind of manifest a treasure yield in my hand that then I can transfer to you and vice versa and go to the store and spend with and you know by the nature of denominating an economy in the non-new bearing version you're in you're you know increasing you know the opportunity cost of uh or you're increasing the positive carry effects of holding you know the treasury billing token due to the opportunity cost of you know being you know being forced to spend the US dollar and you know it probably is sort of a point here you know if treasury years were on chain you know if we had treasury yields on train would we all just trade treasury yields um and you can kind of think about you know that in you know in correlation to a future where we're trading you know plots um you know if treasury yields are as function and liquid and tradable as dollars would people use dollars and it's kind of like to the point where it's a good Gig if you can get it you know because we're able to and because the government you know because we can't trade in treasury yields you know we're forced to trade in the US dollar and I guess the question I was asking was more why does the government prefer the trading of the use of dollars and not the use of let's call it a 30-day treasury note with some interest rate that they they get to set and then all of the they're they're optimizing around the consistent uh price of the treasury note and then they they still issue longer dated treasuries for example so I think that the question is just from a from a philosophy perspective what is the what is the issue with using a yield bearing currency or a currency that has yield attached to it I I think it has to do with the peg maintenance as you were suggesting moment which is that but but I don't think it's exactly as you're suggesting it's not that the price changes I think it's that the if if there's a an excess of demand for notes for a period of time and then you're gonna have a significant decrease in demand for the short dated notes because they're everyone's using them and now there's a decrease in real economic activity to some extent the the notes still exist and therefore the obligation associated with the increase in Supply exists making it kind of hard to ever get to a place where you can afford a lower real amount of economic activity but don't know if that's the right answer uh just proposing it as a potential answer and in the case of Beanstalk because both this is one of the main advantages that Beanstalk has over the the the the the fungible note system is that both The Silo and the field and I guess the barn as well doesn't have any promise to Mint in any case whatsoever there's no need to Mint such that if the price is too low there's never going to be any additional Supply minted whereas if you're in a high inflationary environment and now you're you have treasure everyone's using notes that pay a continuous guaranteed yield or using beans in in The Silo have a guaranteed minimum yield and the price is decreasing uh such whether it's because of a decrease in real economic activity or just you know your everyday d-pag uh in either case it's probably not ideal from a peg maintenance perspective but again just kind of thinking out loud here don't know how constructive this is I I think it's pretty constructive and and these ideas and thoughts will evolve uh as as we continue discussing them so thank you thank you for taking the time and you know for being open to even though we might have sidetracked a little bit we're almost definitely wrong about a lot of what we said but if there's a grain of Truth in it you know that's exciting because these are open questions we're seeking the truth less wrong so you know one one step at a time less wrong until you find the truth Marcus asks amen amen amen the last bit of his question was um is this something that could eventually become a parameter in the stock gear system could you maybe elaborate on that a bit uh previous would the stock system ever change how beans documents from from our Vantage Point The Stockade system as we've been discussing it is more around the distribution of Silo deposits and not about the yield from Silo deposits so uh if if that makes sense so the the gauge system would be a way for Beanstalk to control or or try to control the distribution of deposits both beam to liquidity and the exposure of being stock to Any Given token or protocol or chain uh through maybe multiple layers of managing risk to any any centralization through the the the allocation of seeds to given tokens in a dynamic fashion and then there needs to be some way for stockholders to vote uh on what those optimal exposures are but that's what we mean by the stock Aid system or have meant obviously there's no formal documentation uh at the moment it's just thoughts but that doesn't really that wouldn't Encompass something like a an automatic yield to the silent to us that would be a totally separate question okay from a theoretical perspective yeah the next question comes uh from brilliant and and he asks in addition or alternatively to adjusting seed rewards for Android assets what are your thoughts on restricting converts above Peg on Android assets whether the disabling convert until bin has depaked significantly upward let's say above 1.01 or restricting it all together well it's a loaded question brain uh uh I think the we [Music] we view the goal of being stock to as primarily a volatility dampener and therefore and in particular volatility dampener over long periods of time such that short-term volatility is not really the problem uh with that said short-term volatility is nice everyone loves of all uh but if if the problem is is that there's too little volatility being stock is doing its job and and and that's that can't be understated uh however this is directly related to the earlier question around if the the conversions under a normal situation are so strong so effective at TAG maintenance such that in ninety percent of the time there's a very little yield going to Silo and very little pods getting paid off and then there are Wind Falls uh where once all of the lp has been all of the beans in The Silo have been converted to LP now there's nothing to convert and now there's huge pumps in the bean Supply on the one hand that really is the healthiest state of Beanstalk and so it's very hard to feel like that where there's a high rate of liquidity to be in Supply it's very hard to think that it makes sense to have Beanstalk optimized around anything other than uh getting to that state and so like Fast converts is is very healthy for Beanstalk particularly I mean really on both sides it's very healthy on both sides for Beanstalk and yeah don't think it's in beanstalk's interest to disincentivize converts it's more a question of how can an incentivize convert to further minimize volatility uh now if there's too little volatility and then you have large growth Cycles maybe it does make sense to have some sort of minimum yield or or attempt to smooth out the distribution of yield over time maybe there's some lag instead of paying things in advance you pay things over a delay uh but again you don't really want to be minting beans after the fact at a time where now the price is too low so there's a reason why Beanstalk really is just optimizing for the present uh or current data over optimizing over the long term based on just its present State might be the best way to say it so maybe the only caveat would be bringing specific question was around unripe assets and think there's a decent theoretical argument to be made that because unripe assets are old or pre the current Bean Supply that it's not allowing there to be uh real or true or honest and I said all that with quotes uh price Discovery around being uh and don't know how much validity there is to that argument but it's it's it's reasonable enough to make and that would really be the only way I think to get to a point where where that makes sense it's a change to make the Beanstalk but yeah probably not a fan I guess it goes back to you know being inspect can't complain so Peg will always be a priority over the yield next question is from Harry Smith he asks when Wells just in case you haven't update obvious this is like the traditional question or the the weekly question yeah we we we love a when well uh on this end don't have much to say although maybe we got Publius up uh here before uh maybe we can get them up again uh to give a more technical update if Harry's interested uh but don't have anything to say on this end from a timeline perspective nothing has changed but getting excited on this end about what what can be done with them so uh yeah Harry's interested in the technical update so nacho approval is just still around the mic but I think it'd be nice to have you come up here if possible well we'll give it a minute see uh food has come up but I guess the next comment from from Harry was that Publius sounds tired so I guess this calls for time for the Bean retreat how about that is it time for the retreat okay so just for reference I I'm here with group list and he's struggling struggling with the Discord so give them a second and they'll figure out how to hop up here apologies okay let's let's give it a minute before we take the second the next question and in the meantime do we have another oh yeah here they are uh um yeah I mean not too much of an update you know we we got the you know pretty much you know it's it's been you know the the big item of topic now you know there's a there's a lot of different things um you know that need to be done to get the wells to the state we want them to be where we have sufficient generalization to the point where you know the the oracles are in a good place to go everything's a good place to go so you know basically we're just putting the the oracles together now which we're calling pumps you know each well can have a certain amount of pumps um so you know once we have these Oracle solutions that you know can kind of uh you know sequentially and you know modularly be attached to liquidity pools um while being in a state where you know where we'll hope be able to have uh you know some stuff uh you know ready to share with you guys but you know for now no further updates uh you know appreciate you guys asking and making sure we're always working as hard as we can yeah I mean I feel like maybe it would be helpful to talk a little bit about the architecture as it's currently being designed where people and feel free to chime in if you'd like Publius but the the wells themselves are going to support humps and pumps can be deployed permissionlessly although the hope is to have a series of pumps that are audited and uh supported and then when Wells are deployed and Wells can be deployed permissionlessly at the time of deployment the pumps for the well are selected and it's all permissionless and the the point is that the pumps required data to be stored on chain and in order to maximize the efficiency it's it's important that each well has its own custom set of pumps such that the the necessary data is being tracked but no more and no less and so the hope is to have a a fully permissionless uh very composable system of wells and pumps that combined allow for uh the permissionless deployment of markets and the the reading of prices from those markets uh that's how it's currently being architected and worked on and uh I think that might be a helpful additional piece of color there foreign this may be um a new introduction about pumps Austin asks what are some example uh pumps that would be audited up front and added to the amm maybe briefly put this second what what is a pump and like what's the use of it so I think it might be helpful to get published up here because they've been doing a lot of work on the different types of pumps and whether it makes sense to support smas or EMAs and what are the from a manipulation resistance perspective what are really the data points that matter but a pump is from an abstract perspective it's the data that is being stored within the well that effectively creates a price feed or can be used to create a price feed so the question is what what is the data that needs to get stored in order to derive a reliable price or prices from this well and the the pump is the the specification for each well awesome um so you know it all boils back to you know the Oracle problem you know when you deposit an offset let's say in The Silo um let's say you take something three curve and put it in a silo Beanstalk has to evaluate what is the value in beams of that token of the amount of tokens when you deposit it so it knows how many stock to give you and how many seeds to give you um and what essentially this is is we need to calculate in some way you know some amount of being three curve in beams um now as we're all familiar with there are multiple ways to do uh you know oracles you can have on-chain oracles and you can have octane oracles um we've always been big proponents of Aunt and oracles just because you know any sort of off-pain computation introduces new um you know potential security risk points and you know you're only as strong as your weakest link if we're using a off-change solution that takes some ring signature of let's say 11 validators you know the Beanstalk protocol is only secure as those 11 validators so we generally prefer you know we can only try to strive for on-chain Solutions um you know recently we've seen you know or at least within the past few months alone we've learned a lot about oracles you know collectively uh you know as the Beanstalk community and you know we've come to learn you know we can't use instantaneous oracles you know we we need flashlight resistance um you know with uh the merge came multi-block Mev now we can't really use last block oracles uh because someone has the potential to manipulate the balance within the wells for longer than a block say um so It ultimately comes down to the question of you know what on-chain Oracle can we use and you know we want to take kind of a generalized approach to this where we can then basically create the best Oracle we can conceive such that we can continuously iterate as you know problems or potential better oracles come up so the I you know so to start you know we abstract the pumps away such that each well can event pumps and then real simply a pump is something it's a statistical value on chain that you know will get updated every time someone interacts with the pool and the balance pages and you know thus you know can be you know thus you know you know uh I guess you know when it comes to examples of pumps you know we all know the SMA you know kind of let's take the average over the last hour um you know like a t-wop style you know we could use an EMA where we use an exponentially weighted average we could use a geometric mean or an arithmetic mean um you know and even then when it comes back to let's say we're using an SMA with geometric mean how many what is the look back we want to be able to have on the bdd function do we want an hour do we want a day do we want you know six hours Etc um so you know all of these things are you know going to be generalized at the pump level such that you know we can kind of collectively with the beanie well basically say you know we could theoretically deploy any pumps but here are the pumps we think are best given you know uh the current state of oracles and you know we can start with deploying those and uh you know maybe we like it maybe we don't we can always change them modify them upgrade them very easily at the well level um you know the hope is to eventually somehow enable governance to be you know uh controlled by the actual holders of the well LP token instead of stockholders so you know it's basically you know so it'll be much easier to pass governance level votes at the well level um you know so overall you know there's a lot that really you know there's a lot there's a lot you know to of experimentation left I guess to be done with on chain um you know oracles and the the idea is to create a architecture such that we can you know deploy as many and as you know different ones which we want while also being able to you know experiment ourselves um hopefully that answers things thank you Publius I'm pretty sure we're going to be revisiting this topic um in the coming weeks if Wales had a question on my apologies for missing it if what I'm probably CS do you think the protocol is immutable or will need significant changes in the future to survive I think there are a few questions there about publicity oh Beanstalk is not immutable Beanstalk is mutable the diamond standard is is immutable uh but that's separate from well Beanstalk needs significant changes in the future to survive I think there's an argument to be made that Beanstalk could just run in perpetuity in its current form the lack of volatility right now is a good indication of that uh now the reality is that Beanstalk exists in a competitive market environment and it's unlikely that if Beanstalk today goes the way of Bitcoin where the goal is to ossify the protocol as much as possible at the expense of everything else it's very likely that the credit based model that Beanstalk created or or uh yeah created is going to be forked and iterated on and improved upon and beanstalk's not going to win so from our perspective the question of how to use cryptographic Primitives to create the perfect currency that's a question that certainly still is an answered today even if Beanstalk is the best answer so far and so we as a dow it doesn't make sense to stop iterating today because of the the the competition that lies ahead effectively so it's not about can can Beanstalk stay the way it is it can but it's unlikely to become uh this the support or the base layer of the the whole crypto economy that I think we're all very excited about so that it's a question of what are the priorities and I the priority the priority at least to us and this isn't this isn't the Dow the Dow has to decide you know we're big fans of the royal we but uh in this case this is just our opinion in in our opinion it's it's it's foolish to stop working on improvements and if if the Dow at some point stopped changing Beanstalk it wouldn't stop us from thinking about how to improve it and working on improvements we're we're interested in the question uh around creating that that perfect money and uh also really interested in building awesome Tech and a lot of the thing that I think is so exciting about Beanstalk or we think it's so exciting about Beanstalk today is that it's attracted a ton of curious entrepreneurial thoughtful builders that are coming to Beanstalk with their ideas and there's a lot of positive some synthesis happening around that uh but as soon as that stops as soon as people are are no longer iterating on Beanstalk uh that that becomes a lot less attractive to be a part of so I feel like it's it's almost a catch-22 but it's also to be up front that there's even if there's no work that needs to get done uh there's work that should be done and there's a big difference between the two and so from our perspective it's just about working on the stuff that should be done even if it doesn't need to get done so yeah yeah it's a really important question that you're asking each wallet and I think to some extent that's reflected in in kind of how all of this works right where there's the the Dow and the Dow can work can can approve any changes to be in stock there's Beanstalk Farms which is working on changes to be in stock there's root that's working on changes to be in stock uh and then there's odds and we're also working on changes to be in stock and we're kind of helping stock Farms we're working in coordination with being stuff on us we're trying to help root uh we're working with them uh we're we're trying to help other third-party developers that are starting to work on Beanstalk as well so there's certain things that we're very excited about problems that are to be frank very scary problems right what is the the underlying cause of all of the hacks in in defyer or or the vast majority well the vast majority are Oracle issues so there's something to be said for you know maybe it's foolish to to spend our time thinking about and working on a solution to the Oracle problem but that's that's fun for us so maybe it doesn't need to happen uh Beanstalk will probably succeed in its maybe it probably is the wrong goal but probably it's maybe the wrong word but Beanstalk is is certainly able to it's certainly possible that Beanstalk will be able to create tag maintenance uh in its current state for a very long time but it's it's it's it's it's less clear that Beanstalk will be able to to be the the thing that I think we all want it to be uh in the face of competition with itself uh if that makes sense so it's a it's a fabulous question okay thank you for this uh for the detail answer and it's what it says but you know I love your passion um for what you built up okay well at the end of the questions of the Town Hall chapter give us a minute or two and see if other folks have have any questions from Publius mod that's that's not very nice of you oh we we go back to it then so the question from Publius is can you clarify the difference between being a peg or being a peggish if the Delta B is greater than whatever the demand for soil thing is I think it's five uh it's either one bean or five beans uh then you're then you're a peg uh otherwise you're at best peggish and then these wallet made a joke that we want pegased which I guess would be a Delta B of zero so uh you know we'll be here all night folks there you have it we have we have it you know it's decided to have a new definition someone someone please submit a PR to the white paper uh when appropriate okay uh I'll give us a minute see if others uh have questions again about anything that was discussed or something that we haven't okay Publius I have a question of mine and it's a bit you know philosophical so that there is no answer to it um and we can maybe end our favorite kind of question all right what do you think is the purpose of of being stuck um it's a lot easier to answer a question with no answer if there's no right answer not at all what do you think is the objective or the purpose of doing stock is it purely uh to maintain Peg let's say or to look after being or would the Dao Venture into other let's say you know purposes or things um I'm going to say something that may sound silly but just use it as an extreme example is it okay for the Dow to think on like hey we have this liquidity let's take some of it and you know do some yield farming with it uh and you know expand that to any other thing that the Dao may do or the thinking will be is that you know whatever it is that Beanstalk does it is solely to you know protect the price of being or to maintain the price of being let's say so this is a great question there's there's something to be said for what Beanstalk aims to be or is presented as and what it is in practice and practice the Dao can do whatever it wants and as we learned in April if the doubt is compromised in in any way uh then all bets are off and the Integrity of whatever Beanstalk was attempting to be uh is compromised so there's there's a question of in practice what what happens is is is really dependent on the will of the Dow now if we assume the security of the Dow don't think it's unreasonable to to make it a goal and maybe the the Dow should should publish at some point these stated goals you know if the white paper isn't strong enough maybe it's worth having principles that are stated around uh Financial Freedom and censorship resistance all the censorship resistance it's certainly uh mentioned in the white paper maybe it makes sense for the Dow to ratify certain policies that no wallet will have their assets removed or uh land out without their you know they're doing so or lots of variations of that around ownership uh but feel like in general the fact that everything is defined through smart contracts makes it such that it's not necessary uh and in practice as long as there's a sufficient sufficiently clear and truthful piece of technical documentation or written written documentation that that lays everything out I think that think that there's less ambiguity and even in the case of the the attack that happened in April what ultimately was exploited was written about in the white paper very clearly and so it is a question of making sure that Things Are everyone is on the same page about what what are the standards that the Dow and Beanstalk thereby is going to abide by now if you ask us what is the purpose of being stuck is to create uh the best money ever and uh to to be the issuer of new money that is better than any money that has ever existed uh money is censorship resistant sort of by Nature when it comes to utility it's very hard to have a a money that isn't censorship resistant and so to some extent the Dow doesn't even need to ratify those principles if the Dow goes against that there's certainly going to be a bean Fork that very quickly is optimized around censorship resistance so there's yeah there's no right answer here but I feel like at the end of the day the the economics of the situation have to dictate what the principles really are and even if even if we as a dow or we as individuals have specific goals these are really all economic and there's a reason why right now people are still using dollars across the globe despite the recent censorship of uh Russian Russian Nationals uh holding dollars in Russian bank accounts uh but we we did I read an interesting thesis last week that one of the major reasons for the outflows in capital from Britain I mean it's doing financial troubles that they've been having is a result of the loss of London and England in general as a safe haven for foreign wealth as a result of the decision to censor uh and confiscate the wealth of Russians and the result is that lots of foreign money has now moved away from from from England and London so these are economics issues fundamentally and the if the goal of Beanstalk is to create the best money then you're really just trying to answer an economics question on well what is what does utility look like and there is probably some scenario where there's some activity that you in a perfect world like to point your finger and say that activity at probably best not to allow that activity in this economy uh and maybe there's a system that ultimately gets implemented in Beanstalk to to either penalize or minimize certain certain activity but at the end of the day it's all economic activity if the goal if the technology is credibly neutral it's very hard to to do that in in a in a neutral fashion so the purpose of Beanstalk is to create good money and and no one wants money that can be used rugged out from under them so that applies in a lot of different ways but I feel like that's really the goal I think the censorship resistance but takes does it reminds us back with the the tornado cash sanctions and and then um where the thinking is if you introduce some sorts of you know um censorship resistance again um that causes friction it's best to solve these things without adding friction you know to to the economics or to the economy in itself in my opinion of course if wallet asks what do you think about the controversy concerning the centralization of if network with large institutional validators who are some of them you know linked maybe to governance or you know they're centralized and generated do you think there's any risk being on the ethereum um blockchain the short answer is there's obviously risk everywhere uh it's very clear that ethereum is optimizing around decentralization first but the currently the economics are such that the in practice organization is tending towards centralization but I think it's really important to to note that in an adversarial environment where those economics change eat this Far and Away uh the most uh uh it's able to support the most decentralized uh infrastructure or validators or support however you want to think about it and therefore if the economics changed significantly you'd probably expect in a in a relatively efficient market for very quickly the organization and the level of centralization around the validators and staking to you'd expect the decentralization to improve tremendously in an adversarial environment and then at that point the the driving factor which again it's it's all economics first but once once the situation dictates that it's not in the interest of individual participants to cut Corners around decentralization you'd expect the real limiting factor for each Network to be its technical capabilities and ethereum as we started the answer to this question with is far and away at least of the the l1's that are currently in production uh and have are usable uh it's far and away the one that supports the most decentralization so I think it's more an issue of Economics incentives than a non-adversarial environment than it is a question of in an adversarial environment how it would work okay we're at the end of the Town Hall questions maybe we can enter to the last comment from asphy who who says the purpose of being stock is to make seeing it great again thank you everyone for joining us in today's class and thank you Publius as always for answering and taking the time to answer questions we'll see you next week yeah I I think it's a class is starting to get a little bit more abstract and uh less less definite about how to stock grown stock work and more about well how how might this work or how does this macroeconomic what do we think about this it's very exciting for us that this is the direction that things are heading but just want to note we we don't know the answer to any of this as we were talking about before and we we we're so grateful for this forum and uh you know look forward to this every week and love sharing this time with you guys and we're gonna keep digging in and know that you guys are too and uh this is just the discourse that we're very grateful to be a part of so uh thank you guys thank you