Discover Compound (COMP) | Buy and Trade Compound Coin


Compound was started with the goal of creating more robust credit markets, a necessary component of any functional financial system. While centralized services can offer these facilities, they are trust-based systems that compromise on the decentralized nature of cryptoassets. This can be solved by creating trustless peer to peer protocols, however, they require more active participation from borrowers and lenders needing to be matched. Compound looks to solve these problems by creating a pooled loan model that allows users to deposit into a pool that borrowers can then withdraw from provided they post sufficient collateral. This means loans do not have any maturity and users do not need to wait for a counterparty since they are interacting with the aggregate of all users. Compound allows users to earn interest on their holdings, short assets they think are overvalued, or obtain assets they need to utilize without having to purchase them.

Gradual decentralization
Compound initially began as a tokenless protocol. Upgrades and changes were made unilaterally by the Compound Labs team. The protocol was still non-custodial but there was a centralized entity that retained administrative privileges. In order to remove themselves from this position, the team introduced COMP, a token used to govern the protocol. After several stages, Compound is now fully controlled by COMP holders with no remaining privileges held by Compound Labs.