Compound is an algorithmic, self-sufficient interest rate protocol designed for programmers that may be used to enable a wide range of decentralized monetary programs. The COMP token holders and their delegates run Compound by proposing and voting on protocol changes.
The development of a new DeFi coin called YAM for the Yam protocol is credited by Compound observers as the primary driver of Compound’s rise during the previous 24 hours in January this year. Compound is a coin used for bitcoin “farming,” and the rising demand for this asset has pushed up its price. When other cryptocurrencies failed a year ago, Compound stood firm.
The Compound has, perhaps, seen a remarkable bull run since its 2018 debut. The value of a Compound coin has skyrocketed in recent years. Increased network activity has contributed significantly to the Compound protocol’s growth margins. Multiple investors have shown interest in the platform, leading to massive rises in its Total Value Locked (TVL).
Total protocol value (TVL) is the sum of all encrypted assets using a specific protocol. The Compound platform’s TVL includes its Liquidity pool and collateral deposits.
According to several compound projections, Compound is a fantastic token to invest in because its robust technology is expected to survive the test of time and its consistently rising value.
The platform can collateralize user holdings through smart contracts, after which cTokens are minted so that users may borrow against the collateralized assets.
Users may now receive income on their investments without liquidating their shares first. All cTokens are ERC20 tokens, and the network is built on Ethereum. They’re versatile and straightforward to use or sell on markets. The Compound team is diligently trying to make their product the best option for earning interest on cryptocurrency holdings.
The group continually works to improve the service and make it more accessible. Compound has the potential to become the foundation of the DeFi ecosystem by facilitating the seamless accumulation of interest in digital assets.
Table of Contents
Compound (COMP): Overview
The network’s native utility token is called Compound. It’s the driving force behind the cryptocurrency lending and borrowing platform’s infrastructure. It’s part of the DeFi lending system, which lets users get paid to put their cryptocurrency into one of many pools. Compound is doled out daily from a predetermined stock.
The website counts and displays how many tokens are still available for purchase. The responses indicated that token holders might use COMP to discuss, propose, and ultimately vote on any proposed protocol improvements. Each market’s providers and borrowers receive 50% of the tokens issued by the platform. Every time you do something inside the ecosystem, you’ll receive a little amount of COMP in your wallet.
Users may instantly lend and borrow cryptocurrency through COMP, eliminating the need for a middleman and the associated fees they often incur. It’s not a meaningless token; it has practical applications and actual worth. Keeping people on the platform is a priority for COMP and its use cases. Postmates is still a company where both Compound’s CTO and CEO cut their teeth in senior positions and still work today. They also state that they have top-tier investors.
Users may earn interest on their cryptocurrency holdings with Compound Coin, a decentralized lending mechanism built on the Ethereum blockchain. Users can borrow and lend bitcoin assets, as well as trade them on a decentralized exchange on the crypto market, thanks to the protocol.
So that owners of digital assets can receive interest on those assets, the Compound protocol may be implemented by dApp developers. Compound may be viewed as a “money market” for cryptocurrencies in this sense.
The COMP coin is the Compound protocol’s native token, used for paying interest and fees for borrowing and lending. The future of the Compound protocol is steered by COMP coins, which are also used to vote on important issues related to the system.
Users are rewarded with COMP tokens in exchange for their participation in the network in asset borrowing and lending. Users are prompted to provide liquidity to the network in exchange for COMPs.
|Year||Potential Low||Average Price||Potential High|
Compound (COMP) : Tokens & Valuation
Compound is a widely used cryptocurrency that was developed on the Ethereum network. This protocol is a part of the decentralized financial system that allows users to exercise control over the Compound system. When it comes to cryptocurrency exchanges, Compound (COMP) was the first to implement yield farming.
Like other DeFi systems, the COMP token is also used as the native cryptocurrency and governance token on the Compound platform. Users of Compound may vote on the network with COMP tokens to choose the direction the platform will go in the future. All COMP holders also have access to the ecosystem’s core workings, including the protocol, treasury, and other administrative functions.
Compound is one of a kind since it eliminates the middleman and facilitates user-to-user lending and borrowing. This enables people to earn income on their crypto assets without selling them at a low price. Furthermore, Compound uses an algorithm to modify interest rates according to the supply and demand of each asset in the loan pool, as indicated by the asset’s price movement.
This ensures that customers may always take advantage of the best possible APRs. Lastly, borrowers should not be concerned about Compound’s built-in safeguards against price volatility.
Lenders and borrowers can negotiate terms of a loan or other financial transaction using cTokens, much like they would at a traditional financial institution. However, the Compound technique streamlines many steps to applying for a traditional loan.
Due to the loan terms embedded in the protocol and cTokens, users are exempt from having to fill out any additional paperwork or submit a formal loan application. Automatic judgments, such as the amount of interest to be paid, are made based on the terms of these predetermined smart contracts.
Users earn more COMP tokens every time they engage with a Compound market (borrow, withdraw, or refund the asset). Despite its complexity, the idea has attracted users and inspired other DeFi coins to follow it.
One of the best ways to earn on your cryptocurrency assets over time is to lend tokens on Compound. A total of 14 cryptocurrency pools, including Ethereum, Uniswap, and stablecoins like DAI, are currently hosted by Compound. Regardless of the number of tokens lent or borrowed, the interest rates charged by each pool are fixed. You’re free to keep your share of a pool for as long as you like and to cash out whenever you choose.
For Retail Investors
The Ethereum token known as “Compound” facilitates interest accrual on existing cryptocurrency assets. Staking COMP in the Compound procedure is required. Higher interest rates are available for COMP holders who stake more of their currency in the protocol.
Compound was developed to eliminate the need for a third party when borrowing or lending cryptocurrencies. Lenders gain interest in the form of brand-new COMP tokens whenever they lend cryptocurrency to a borrower by contributing their assets to a shared liquidity pool. To borrow funds, borrowers must put up collateral (liquidity pools utilize a series of smart contracts to connect borrowers with available loans).
Given its promising future, COMP is an excellent choice for those who plan to retain cryptocurrencies for the long haul and hope to profit passively from their investments. Since its inception, COMP has steadily increased in worth. This is because the Compound protocol and COMP tokens are becoming increasingly popular for earning interest on cryptocurrency holdings.
As interest in the Compound protocol grows, so does the value of COMP coins. As more individuals start utilizing the platform to earn interest on their cryptocurrency holdings, the value of COMP tokens is expected to rise.
All that is required is for token holders to discuss, submit, and vote on proposed changes to the protocol, and the Compound team will be left out of the loop. This method can establish token distribution, collateralization rules, and which cryptocurrencies to support. It may also be used to roll out updates that provide access to improved features.
Voting rights for tokens can be transferred to another wallet address. Autonomous suggestions can be made by wallets with at least 100 COMP. In comparison, governance proposals can be made by wallets with at least 25,000 COMP.
Compound (COMP): Price History & Overview
From a peak of $116.01 on 5 May to its current price of $57 on 29 July, the Compound cryptocurrency token (COMP) has lost nearly 60 percent of its value in the previous few months.
Token support was boosted in April when it was included in the Robinhood trading app, but this was not enough to prevent further declines.
Out of a possible 10 million COMP tokens, more than 6.7 million are now in circulation. Each day, users receive 1,139 COMP tokens. Holders of the COMP token decide how much of each token should go into each liquidity pool. The COMP token is the protocol’s governance token and is built on the ERC-20 standard used by Ethereum.
Compound (COMP): Price Prediction
By mid-2022, the cost of The Compound had risen to $198.9. Although it did see a boost at the start of the year, with the price touching $243.8 by January 5th. This increase didn’t last long; by January 22nd, the digital asset had fallen back to its support level of $122.4. Following a consolidation of backing until February 4th. On February 8th, thanks to some sort of boost, the price had risen to $150.
However, market uncertainty caused a drop to $99 by March 14th. After that, the quarter ended on an upswing with a price of $164.2. A dismal second quarter saw COMP’s value cut by more than 80% due to severe downpours.
We may anticipate some action for Compound for the rest of this year. Suppose the alternative coin maintains its optimistic tone from the second quarter. In that case, it may find additional support from new projects and efforts to grow its user base. A possible COMP price rise would put the cost at $75.09.When using a linear price estimate, we get to $63.04 as a possible final price. Due to waning support for the protocol and critical feedback, the cost may be reduced to $49.64.
It is crucial for the network that Compound’s Treasury sees an increase in traffic and that meaningful partnerships and adoptions are announced. Furthermore, suppose the protocol receives good social feelings. In that case, COMP’s price may reach its possible high of $96.08 before the end of the year’s trading.
On the other hand, if the protocol doesn’t work as planned, or if the market crashes, the price might drop below $68.40. However, if market forces hold steady, an average price of $79.15 is possible.
Compound (COMP) Price Prediction for 2023-24
In the instance that several initiatives require Compound’s features, the business world observes Defis expanding its wings again. If the price of COMP continues to show strength, it may reach $165.01 before the year’s end. Contrarily, $87.76 might be where the price ends up if new solid competitors enter the market. When both bullish and bearish price forecasts are considered, the midpoint might be $122.92.
If the team behind Compound announces community-building activities, this may be a good year for the platform. The halving of Bitcoin’s block reward is another potential catalyst for the digital asset. Possible increases of $274.97 are possible in such optimistic circumstances.
On the other hand, falling trading activity in the face of a potential market collapse may send prices tumbling to $148.76. If buying and selling are in balance, COMP might end up at $207.55.
Compound (COMP) Price Prediction for 2025-29
The price of Compound will rise along with the rest of the economy in 2025 as the DeFi and lending industries flourish. To sum it up, analysts project that Compound will cost an average of $808.29 by the end of 2025, with a high of $943.97 and a low of $580.11. If this figure is representative, it will represent an increase of 457% since 2022.
Compound (COMP) Price Prediction for 2030
The DeFi and loan industries should continue to grow in 2025, driving demand for Compound and its price. Long-term forecasts place the price of Compound in 2025 at a high of $943.97, a low of $580.11, and an average of $808.29. This figure represents a growth rate of 457% since the year 2022.
Is it secure to use Compound Crypto?
There is a general consensus that Compound is a secure place to live. Tokens worth up to $80 million were in danger due to a problem discovered in early October 2021. While this problem persisted until Proposal 064 was implemented, it is thought to have been fixed. Furthermore, the Ethereum network guarantees the integrity of Compound, making it a popular choice among crypto enthusiasts and reliable investment. Comp is more secure than most other cryptos, although none are entirely foolproof.
How does the COMP Coin function?
Lenders can easily withdraw their funds at any moment using the cToken that is issued in exchange for their deposited cryptocurrency. Users may earn COMP tokens by engaging with Compound in numerous ways, including taking out loans and paying them back.
For what reason is Compound increasing?
Last year, Compound's price increased due to the rising demand in the DeFi industry, where Compound is a frontrunner and the rising value of Bitcoin. Compound's cost is determined chiefly by these two variables.