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  • Compound
  • Compound
  • Rank #188
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Compound Price (COMP)

₹ 6648.3100000000 2.42 %

Low : ₹ 6017.5400 High : ₹ 6336.3600

Market Cap

₹43.39 B

2.6944 %

All Time High : ₹66833.0000

All Time Low : ₹2058.9800

Volume

₹2.77 B

Circulating Supply 6856090
Max Supply 10000000

Compound (COMP) Price Live Chart

Compound (COMP)

Compound stands as a prominent DeFi lending protocol, offering users the opportunity to earn interest on their cryptocurrencies through deposits into supported pools. When users deposit tokens into a Compound pool, they receive cTokens in return, representing their stake in the pool. These cTokens can be redeemed for the originally deposited cryptocurrency at any time. For instance, depositing ETH yields cETH, and over time, the exchange rate of cTokens to the underlying asset increases, resulting in a higher redemption value and the accrual of interest.

On the lending side, borrowers can secure loans from Compound pools by depositing collateral, with the maximum loan-to-value (LTV) ratio varying based on the collateral asset. Currently ranging from 50 to 75%, this ratio determines the borrowed amount relative to the collateral. The interest rate for borrowed assets varies, and borrowers face automatic liquidation if their collateral falls below a specified maintenance threshold.

Since the Compound mainnet launch in September 2018, the platform has witnessed exponential growth, recently surpassing $800 million in total locked value. This popularity underscores its significance in the decentralized finance ecosystem, offering users a dynamic avenue for earning interest and accessing secured loans.


Founders

Established in 2017 by Robert Leshner and Geoffrey Hayes, Compound originated with the expertise of both founders who previously held significant roles at Postmates, an online food delivery service. Within Compound Labs, Inc., the software development firm steering the Compound protocol, Leshner currently serves as the Chief Executive Officer (CEO), while Hayes assumes the role of Chief Technology Officer (CTO). Despite their backgrounds in founding successful ventures, Leshner, in particular, has demonstrated notable involvement in fostering blockchain growth. His public investments include contributions to well-known crypto platforms like Argent Wallet, Opyn, and Blockfolio.

The Compound team, consisting of over a dozen individuals, is led by these experienced founders. Notably, nearly half of the team members are engineers, reflecting the technical prowess embedded within the project. Leshner and Hayes, with their leadership roles, continue to guide the Compound protocol, contributing to its growth and influence in the decentralized finance sector. The team's diverse skills and the founders' commitment to both technological innovation and blockchain development underscore Compound's position as a pivotal player in the evolving landscape of decentralized financial protocols.


What Makes Compound Unique?

Compound addresses the issue of idle cryptocurrencies by offering an open lending platform, transforming these assets into opportunities for their holders. This platform enables users to deposit supported Ethereum tokens, effortlessly earning interest on their balances or securing loans in a trustless manner.

What sets Compound apart is its distinctive community governance model, differentiating it from other protocols with similar functionalities. The platform's native governance token, COMP, empowers holders to actively participate in shaping the protocol's evolution. COMP holders can propose changes, engage in debates, and vote on protocol adjustments independently of the Compound team. This decentralized governance mechanism allows for community-driven decisions, including the addition of supported cryptocurrencies, adjustments to collateralization factors, and modifications to COMP token distribution.

COMP tokens can be acquired through third-party exchanges or earned by actively engaging with the Compound protocol. Interactions such as depositing 

assets or taking out loans contribute to the acquisition of COMP tokens, fostering a participatory ecosystem where users play a pivotal role in steering the protocol's development and decisions.


Network Security

Compound operates seamlessly through the utilization of smart contracts, automating the entire process. Upon depositing Ethereum and ERC20 assets, smart contracts come into play, facilitating the minting of cTokens. These cTokens represent users' stakes in the Compound protocol and can be redeemed to access the underlying assets.

A critical element enforced by the protocol is the collateralization factor, applicable to all supported assets. This ensures that each pool remains overcollateralized, adding a layer of safety to the system. Should the collateral fall below the specified minimum maintenance level, it triggers an automatic process wherein liquidators can purchase the undercollateralized assets at a 5% discount. The proceeds from this sale contribute to paying down part of the loan, with the remaining funds restoring the collateralization factor to an acceptable level.

This mechanism serves a threefold purpose: it promotes responsible borrowing behavior by ensuring borrowers maintain adequate collateral, provides a safety net for lenders by securing their interests, and offers an earning opportunity for liquidators participating in the corrective process. Through these automated smart contract protocols, Compound creates a robust and self-regulating ecosystem, fostering trust and stability for all participants in the lending and borrowing processes.


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Compound news

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