The FutureĬompound, and DeFi more broadly wants to help people have more access and control over the money they earn and save. If the value of your collateral drops too far, you risk getting liquidated – having your collateral automatically sold to repay your loan. Borrowing crypto assets has the added step of making sure the value of your collateral stays above a minimum amount relative to your loan. What can you do with Compound?īesides earning interest on your crypto assets, which is a fairly straightforward process of depositing crypto assets on the platform and receiving cTokens, you can also borrow crypto on Compound. As of December 2019, users of Compound could borrow or lend BAT, DAI, ETH, REP, USDC, WBTC, and ZRX.
Compound define finance plus#
How do you get hold of cTokens?Īnyone can mint or create cTokens using an Ethereum wallet such as MetaMask, Coinbase wallet, or Huobi wallet plus one of the crypto assets the Compound system currently accepts. If users want to use USDC to earn interest, they receive cUSDC when they deposit USDC into the system. If users want to take out a loan using ETH as collateral, they automatically receive cETH in return for their deposited ETH. New cTokens are created whenever a user deposits crypto-assets into the Compound protocol. According to Soleimani, users’ funds were vulnerable to both attack and manipulation because the protocol wasn’t fully decentralized.Ĭompound founder Robert Leshner responded to the critique with a promise that the Compound would eventually become the fully decentralized application the Web3 community had always hoped for. One of Compound's most public criticisms came from Spankchain founder Ameen Soleimani who wrote about the potential centralized point of failure in the protocol–a big no-no in the world of decentralized finance. At any time, you can redeem your cUSDC for normal USDC plus interest paid in USDC.Įach asset has its own market and the amount of supply or demand in that market determines the interest rates–how much money your cTokens will accumulate over time. For example, locking up USDC in the protocol generates cUSD–tokens which automatically earn interest for you. By putting ETH or another ERC20 like USDC in the protocol, users get an equivalent amount of cTokens. Ĭompound tokens or cTokens are simply ERC20 tokens representing a user’s funds deposited in Compound. Where Compound stands out is the tokenization of the assets locked in their system through the use of cTokens. On the surface, Compound resembles other decentralized lending protocols in that it uses crypto assets as collateral to borrow more crypto assets. Robert Leshner, a former economist, is the founder and CEO of Compound. Loans can be paid back and locked assets can be withdrawn at any time.īuilt on top of that principle is cTokens, Compound's native token that allows users to earn interest on their money while also being able to transfer, trade, and use that money in other applications. Interest rates are generated with every block mined. The interest rates paid and received by borrowers and lenders are determined by the supply and demand of each crypto asset. Compound focuses on allowing borrowers to take out loans and lenders to provide loans by locking their crypto assets into the protocol. Like most Decentralized Finance (DeFi) protocols, Compound is a system of openly accessible smart contracts built on Ethereum. Licensee shall do nothing which would jeopardize the good will or reputation of MPP or Pfizer or the reputation of the Compound, Product and/or Licensed Product.$0.04093886 -1.72% Terra Classic (Wormhole)
Compound define finance license#
Nothing in this Agreement shall provide a right to Vend, Retail, donate, offer for sale, sell or otherwise distribute the Compound, Product or Licensed Product outside the Territory for further offer for sale, sale, donation or distribution of the Compound, Product or Licensed Product outside or for use outside the Territory.įor clarity, licenses granted under Sections 2.1 and 2.2 of this Agreement do not include a license to processes or procedures for the manufacture, production, packaging, labeling, warehousing, and quality control testing of the Compound, Product and/or the Licensed Product that are not expressly included in the Patents and/or Licensed Know-How. Licensee agrees that it will manufacture the Compound, Product and Licensed Product in a manner consistent with (a) WHO Prequalification standards or (b) the standards of any SRA. No license or right is granted by implication or otherwise with respect to the Compound, Product and/or Licensed Product, except as expressly granted herein. Examples of Compound Product in a sentence
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