Beanstalk Farms · May 25th, 2022

Beanstalk: The Path Forward FAQ

Additional information about the plan to recapitalize and Replant Beanstalk.

Check out A Farmer's Guide to the Barn Raise for a comprehensive overview of the Barn Raise mechanics.

The Barn Raise

Why does Beanstalk need a fundraiser?

Beanstalk suffered a governance exploit that drained the protocol's liquidity. The goal of the fundraiser is to recapitalize that stolen liquidity and then relaunch Beanstalk.

Does the protocol need ~$77M? Would a smaller amount such as $XM be sufficient to Unpause the protocol and allow it to grow again in a healthy manner? Is there a minimum amount to raise?

Given the protocol's economic performance prior to the exploit, it has demonstrated sufficient resilience to Unpause even with a relatively small amount of liquidity. With that and the vesting schedule, it is not necessary to raise all $77M before relaunching.

What is Beanstalk's utility?

In the medium term, Beanstalk has tremendous utility as a liquidity provider, having created and scaled three discrete liquidity pools prior to the governance exploit.

Beanstalk is the only positive carry stablecoin in DeFi — it has the potential to be the most economically attractive stablecoin product available.

For more about Beanstalk's utility, please refer to this community-authored article.

Why use a token to represent debt instead of Pods?

Using a semi-fungible token (or any token for that matter) allows Beanstalk to offer the same terms to multiple investors. Pods in a Pod Line have an inherent priority.

Replanting Beanstalk

What's going to happen to Beans, Stalk, Seeds, BDV, and Pods?

Pre-exploit Beans and LP are subject to a vesting schedule such that the assets only vest as Fertilizer is sold and debt to Fertilizer holders is repaid. Pre-exploit Stalk and Seeds are become claimable for Silo Members as Fertilizer is sold.

Example: If Beanstalk sells 100% of the Fertilizer and 50% of the debt to Fertilizer holders is repaid, Silo Members can Withdraw and claim up to 50% of their original asset and forfeit the difference.

What happens to the rest of my assets when I Withdraw and claim early?

Forfeited LP reduces the amount that needs to be raised by the Barn Raise, and forfeited Beans will be effectively distributed to the rest of the pre-exploit Bean holders that are still subject to the vesting schedule.

Are Farmable Beans and Harvestable Pods subject to the vesting schedule?

No.

What pools will be launched when Beanstalk is Replanted?

Beanstalk will be Replanted with a single liquidity pool for Beans—BEAN:3CRV, a metapool on Curve with an A parameter of 1.

What if I had Circulating assets at the time of the exploit?

Circulating assets are subject to the same vesting schedule as Deposited assets.

What if I had Withdrawn assets at the time of the exploit?

Withdrawn assets will be treated as Circulating assets (as if the Withdrawal timer had elapsed).

How will the Weather change after the Barn Raise?

Beanstalk will Replant with the pre-exploit Weather.

Governance

How is Beanstalk Farms going to handle governance moving forward?

On-chain governance has been removed for the time being. A community-controlled multisig wallet will maintain ownership of the protocol. On-chain governance will resume in the future when a safe, decentralized governance mechanism is developed and fully audited.

How will the multisig work?

Beanstalk Farms is evaluating how other DAOs utilize multisig wallets to ensure safe and effective governance. It is expected there will be a minimum of 9 holders included in the multisig. These slots will be split between members of the Beanstalk community, Beanstalk Farms contributors and Publius.

Security

How will you prevent this from happening again?

Governance of Beanstalk is moving to a multisig wallet custodied by the community until a safe on-chain solution can be developed and audited. BIPs will be voted on via Snapshot until then.

Beanstalk will undergo both Halborn and Trail of Bits audits, and Beanstalk Farms will launch bug bounty programs with Immunefi and potentially other reputable bug bounty firms.

Beanstalk Farms will double down on its efforts to attract and retain experienced security engineers who specialize in smart contract development.

Is multisig governance contrary to the decentralized ethos of Beanstalk?

Everything is relative, and the multisig will still be custodied by a diverse set of distributed community members. However, multisig governance is still a sub-optimal and temporary solution. Once Beanstalk has been Replanted, Beanstalk Farms will explore a more resilient decentralized governance solution. Any new governance solution will be thoroughly audited before being proposed on-chain.

Will there be more audits?

Yes. Beanstalk will undergo end-to-end audits with Halborn beginning in mid-May and with Trail of Bits beginning in early June.

Will there be a bug bounty?

Yes. Beanstalk Farms has engaged Immunefi among others to launch a comprehensive ongoing bug bounty program.


Subscribe

Subscribe to The Bi-Weekly Bean and we'll send major Beanstalk updates straight to your inbox.