publius

1/4 We just published two related blog pieces that cover (1) our thoughts on the state of DeFi and (2) how some parts of the DeFi stack should be implemented in practice.

@NourHaridy bean.money/blog/a-framewo… eager for feedback

Midnight thoughts on stablecoins: I’m obsessed with (debt-backed) stablecoin design because I believe they have the potential to be a non-custodial, globally accessible replacement for commercial banks around the world. I’m one of at least hundreds of millions of people in many developing countries who cannot trust their local banks or authorities to simply custody their savings safely. Politicians let the government take massive public debt then when inflation gets out of control, they impose withdrawal and international transfer restrictions on us in order to prevent us from dumping their hyper-inflated fiat coin. We’re forced bagholders basically. USD inflation hedges are not even relevant here. A large % of the world would pay a large premium to simply hold the inflating US dollar right now but are literally forbidden from it. I think this is something that a lot of people here don’t realize. We’re already seeing amazing adoption of USDT around African countries thanks to Binance P2P expansion in jurisdictions that do not have access to on/off ramps through banking. USDT is already being used in international commerce, imports/exports, remittances, personal savings, etc. Unfortunately, Tether is not a decentralized stablecoin and includes lots of counterparty risk (so does Circle). It is backed by and dependent on trad banking and therefore is not resilient against regulatory risk. If the world is already shifting towards a stablecoin economy, we need to provide it with better stablecoins that can last for hundreds of years and withstand the worst attempts of manipulation or capture. Imo decentralized autonomous debt-backed stablecoins are our best shot at this. But our decentralized stables suck. They can’t scale because they’re limited by demand for leverage. They can’t manage risk effectively because our risk tools are primitive and our risk models are arbitrary. They can’t prevent bank runs because they’re unable to socialize losses. Many such problems. I do think we’re eventually going to get there though. None of these problems seem impossible to overcome. Some will require finding the optimal tradeoff tho. We just need more attention and minds to be thrown at these problems. Unfortunately, stablecoin design is a very under-researched or documented field. There’s very little accurate, high-depth learning material around. Nowhere to start as a beginner. Most users of Dai (including integrators) have no idea how Dai works and how it keeps its peg. Lots of false info and misconceptions (e.g. misunderstanding of relationship between stablecoin health and its collateralization ratio). This is something I’ve been thinking about a lot and would appreciate some ideas on. How do we make stablecoin design clearer and more accessible?

let’s run it 🫡

4/4 publius.money/blog/2023-01-0…

3/4 publius.money/blog/2023-01-0…

1/4 We just published two related blog pieces that cover (1) our thoughts on the state of DeFi and (2) how some parts of the DeFi stack should be implemented in practice.

Big shoutout to @beanstalkfarms for their tireless work to help facilitate all of these different developments. A lot of people have been working really hard to launch all these different projects ahead of the World Cup in time for Paradox. twitter.com/BeanstalkFarms…

You can check out the SDK and new subgraph here: github.com/BeanstalkFarms… thegraph.com/explorer/subgr… github.com/BeanstalkFarms…

This week lots of cool tech was launched on and around Beanstalk by a variety of different parties, all coming together to allow anyone to bet on the World Cup while collecting @beanstalkmoney Silo yields.