The DeFi boom continues its course and the Compound platform continues to gain followers within this growing ecosystem, now more than 1.000 billion dollars are locked in the form of tokens within the platform.
Since the launch of Compound, the platform has experienced simply impressive growth and development. Until recently, on Bit2me News we talked about how this relatively new platform was able to surpass the one that had until now remained the predominant platform in the ecosystems. DeFi de Ethereum, MakerDAO. Yes, in mid-June, users and investors in DeFi showed an impressive attraction to Compound's way of operating, making the platform the most used and with the largest amount of money blocked in the form of token usage.
And while it seemed that the euphoria for Compound had diminished in the last week, the platform is now showing a new upswing, surpassing more than 1.000 billion dollars locked within the platform.
Although the information was released by Compound CEO Robert Leshner via his Twitter account, the levels according to DeFiPulse They reveal that Compound currently has an average of $572,8 million locked as of the date of this publication. A number slightly lower than the one previously reported by Bit2Me News, when Compound had $590,7 million in tokens, although it still remains above MakerDAO, surpassing this platform by more than $120 million.
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Leshner says Compound has surpassed $1 billion in DeFi
To be exact, according to Leshner a total of $ 1.002.108.013,15 USD were locked within the Compound platform until a few days ago; a fact that undoubtedly represents a huge and significant expansion for the platform among DeFi users and investors.
The CEO said “there are now one billion dollars supplied to the Compound protocol”, highlighting that he was very excited and euphoric about the upward trend that led this protocol to mark a new milestone within the decentralized finance industry.
While Leshner's post indicated that Compound was clearly on an upward trend, the amount of money locked within the platform is actually almost 42% less than Leshner reported, as evidenced by DeFi Pulse's data.
Similarly CoinMarketCap shows that the COMP token, the native token of the Compound platform that is given as a reward and governance token to liquidity investors, has a market capitalization of close to $558,3 million, worth $217,9 USD per token as of the date of this publication.
The truth behind the incredible growth
While Leshner’s post attracted a lot of positive comments and congratulations for the success, other members of the crypto community said that some of that amount of money on the platform was dubious and questionable. Because the way Compound works allows a user to request a loan and then use it to supply liquidity back to the platform; this process can be done repeatedly by the user to receive profits from the interest of both using the loans and providing liquidity to Compound, which tends to create a cyclical process where the same collateral is used to generate more and more resources.
Although a proposal was made to limit the daily amount of COMP tokens to be issued to ensure the security and stability of the protocol, the platform is not entirely free from the potential risks associated with its way of operating. If the balance between the value of the collateral and the tokens themselves is broken, the entire capitalization and performance of Compound can collapse in an instant, generating million-dollar losses for all its investors.
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