Beanstalk A&T University | Class #2 Notes

Below are my notes for the second Beanstalk A&T University Class. Link to the full audio recording here.

• What's the Health of the Protocol?

  • The most important thing to be paying attention to is the fact that the price has continued to oscillate over $1.00. That's very exciting. In general the continuation of the oscillation and the tightening of that oscillation in a tighter band around $1.00 is an indication that things are generally in a good place.

    

  • And if you look at liquidity over a longer period in time either month or all time you'll see that liquidity is approaching a local maxima.

    

  • Market Cap is back up towards 25M with price at $1 and that's sort of a local maximum. Positive indication that things are heading in the right direction.

  • All time peg crosses are also going up. System becoming more stable over time.

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  • In addition to the pure statistics, the number and quality of snapshot proposals, the team around Beanstalk, are all doing well.

• What's going to change with BIP-2?

  • At the time of the call had 59% of Stalk voting in favor with just under 2 days remaining in the vote.

  • To remind everyone, it requires a 50% vote in favor at least in order to be passed. It will be commit-able about 45 hours from now.

  • The main change is that any claimable pods that are immediately re-investable will no longer touch a wallet. Obviously, pods have started to harvest in larger numbers, and this will potentially encourage more re-investment of pods into Beanstalk. If the calculus is you can harvest and sow or harvest and re-sow or deposit and not realize gains.

  • Also, 4 out of the 24 weather change cases will be slightly more negative. Those four cases are when price is high, debt is high, and demand for soil is increasing or steady, Beanstalk will lower the weather more than it already does. This is intended, now that the price of Bean has stabilized around $1. Given that theoretically the increase in demand for Beans is mostly being driven by stability not by minor increases in weather, it makes sense for weather changes to be made such that weather changes are slightly more balanced so that weather isn't increasing indefinitely. Now that Beanstalk is demonstrating utility it doesn't need to raise weather as aggressively.

• Why did Seasons to Pod Clearance metric double?

  • Every Season, the subgraph computes how many beans will be harvestable and how many will be farmable. Then it computes a running average of what the values are for a 7 day kind of look back and a 30 day lookback.

  • Sowing makes the Seasons to Pod Clearance go up, Silo'ing/LP'ing makes it go down.

• How will Beanstalk incentivize people to LP?

  • As the Pod Line gets longer, it will become less competitive relative to the Silo.

  • As the pod line grows, it seems like the pod line could triple or quadruple in length. Which would cut the pod APY by 75% and at that point in time LP becomes much more attractive.

  • So at that point there's more of a natural equilibrium between those rates.

  • Looking ahead, thinking about a Curve integration and what that might look like. What a Curve pool might look like. That would likely increase the stability of the Bean price and the liquidity around Beanstalk.

• Development Update?

  • L2 Integration & Stalk and Seeds becoming liquid are major milestones to build towards.

  • The general idea/structure of how stalk and seed and if were being technical also deposited beans become trade-able isn't totally determined but is generally ironed out.

  • The current structure in general is that there will be incentivized pools the same way the Bean:ETH pool is incentivized. If you deposit LP tokens in the Silo if you deposit Bean:Stalk Bean:Seed or Bean:Silo pools you'll be able to earn Stalk:Seed on those as well.

  • That will create a use cases for lots of the Silo'd Beans. Will will make them incredibly liquid markets immediately.

  • All of those will be fungible ERC20 tokens. Hopefully the deposits themselves will be ERC1155 tokens which will be fungible within a Season. For example an unanswered question is when you deposit LP in a Season how should one determine what the TWAP of the Season is.

  • In general though, stalk and seed and silo beans are generally ironed out but there's a lot of development that has to go into it. So Stalk & Seeds are definitely in 2022.

  • For L2 thinking about Polygon and Arbitrum. Those two probably make the most sense but also looking at AVAX. AVAX might be more work but also more beneficial in the long run.