Beanstalk (BEAN): tokenomics, risks and score
A credit based algorithmic stablecoin that was drained of roughly 182 million dollars in 2022 through a governance attack rather than a code bug.
What Beanstalk is, and what it does
This is a stablecoin. It is designed to hold a fixed value, almost always one US dollar, so it can be used for payments and trading without the price moving underneath you.
What the BEAN token itself does: It can be staked to earn rewards, though a large part of those rewards is newly issued token rather than earned revenue.
Where it runs: Ethereum and Arbitrum. Mechanism: Credit based algorithmic stablecoin. It has been running since 2021, so roughly 5 years.
The facts
- TICKER
- BEAN
- SECTOR
- Stablecoins
- CHAIN
- Ethereum and Arbitrum
- LAUNCHED
- 2021, so around 5 years of operating history
- MECHANISM
- Credit based algorithmic stablecoin
- MAXIMUM SUPPLY
- Supply expands and contracts to hold the peg
- VALUE CAPTURE
- Staking only
- UPGRADE CONTROL
- DAO governed
- VESTING
- Complete
- LIQUIDITY BAND
- Micro cap. Thin, often a single venue or pool. Treat the quoted price as indicative only.
How the score breaks down
Each dimension is explained on the directory page, and the reasoning behind it is taught in the Academy research process.
Supply and value capture
Supply expands and contracts by design rather than following a fixed schedule. Holders can stake to earn rewards, though much of that reward is newly issued rather than earned revenue.
Changes go through token holder governance, so control is distributed but influenced by whoever holds most. Ownership is moderately concentrated. A handful of large holders could move the market.
Where it is strong and where it is not
- Fully open source, so the code can be independently reviewed
- Vesting is complete, so there is no scheduled supply overhang
- Thin liquidity. Check order book depth before assuming you can exit
- Has 1 recorded incident on its history
Incident history
An attacker used a flash loan to acquire a governance majority and pass a malicious proposal in a single transaction, draining roughly 182 million dollars. The governance system functioned exactly as designed.
Our read
The main risk
A prior governance takeover via flash loan, and an algorithmic stablecoin design that has repeatedly failed elsewhere.
Before you buy anything
Check the contract address against the project's own documentation rather than a search result or a screener link, since impersonation tokens with identical names and logos are listed constantly. Check the order book depth before assuming you can exit at the quoted price. And write down what would make you wrong before you buy, not after. The Academy thesis module covers why that single habit protects more capital than any indicator.