An Ethereum-based algorithmic stablecoin project has relaunched its protocol just under four months after going offline following a devastating $77 million governance exploit.

Following the governance exploit and flash loan attack in April, the protocol and its governance were paused until August 6, when they were relaunched in an event called the "Replant."

Beanstalk stated in an announcement shared with Cointelegraph that it has emerged from the ordeal stronger than ever, most likely in reference to protocol governance and security.

"It has emerged from this ordeal stronger than ever before." It demonstrates the protocol's credibility and potential to help realize a permissionless future," said Publius, the developer group behind the BEAN stablecoin and protocol

According to Publius, protocol governance has now been transferred to a community-run multisig wallet until "a secure on-chain governance mechanism can be implemented."

In addition, the team stated that it had completed two protocol audits from "top not smart contract auditing firms" in Trail of Bits and Halborn.

The spokesperson also stated that new network application development is already underway, with the Root Protocol announcing a $9 million seed round on July 26 to develop financial, commerce, and sports betting marketplaces on the platform..

The project has a long way to go before it can match its previous metrics before the hack. Beanstalk's algo-stablecoin BEAN surpassed a market cap of $100 million in mid-April, but at the time of writing, the figure stands at just $284,426, with the asset trading well below the $1 mark at $0.0039, according to CoinGecko data.

The project has had limited success in recovering the funds stolen in the April exploit. As of June 5, the project had raised $10 million through a fundraiser to replace the funds that had been stolen.

Sustainability over time

However, because the jury is still out on algorithmically backed stablecoins, it remains to be seen how long-term BEAN will be. Publius even mentioned it back in June, writing:

"At the moment, it's unclear whether Beanstalk is good enough to last forever. There are still some inefficiencies in the model. However, it is probably good enough to survive in the short term."

"The thing about the system is that it works until it doesn't. You'll never know for sure if it works, only that it has so far. "Having so much uncertainty is frightening, especially without a clear definition of success," Publius added.

Many projects have devised various methods to avoid the collateral requirements and centralization issues that come with launching a scalable stablecoin.

Beanstalk's variant operates and hovers around its intended $1 peg by relying on a decentralized credit facility, decentralized price oracle, and governance community.

Source:
https://cointelegraph.com/news/once-hacked-for-77m-beanstalk-s-algo-stablecoin-protocol-relaunches

Writer:
Andrew Hayward

Posted 
Aug 8, 2022
 in 
Crypto News
 category

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