Compound is posting a weekly gain of 79,7%, according to CoinMarketCap.
One of the most interesting decentralized lending protocols in the DeFi ecosystem is Compound Finance. This protocol uses investment pools to create a unique, programmable financing ecosystem from which users can access or generate loans. Compound Finance also employs an innovative interest-generating mechanism that allows both liquidity providers and the platform to make money.
Its native token, COMP, is the protocol's reward token, granting its holders voting rights in the governance of Compound Finance.
In the past week, the value of this digital asset has almost doubled. According to data from the CoinMarketCap platform, the price of COMP has recorded an impressive growth of 79,7% over the past 7 days. The price of COMP went from trading at around $36,32 last week to trading at a price of $66,79 per unit, at the time of this writing.
COMP traders are trading over $257 million per day in the token, representing a 276% growth over the previous day’s trading volume. COMP’s market cap exceeds $514 million, ranking it as the 77th largest cryptocurrency today.
Source: CoinMarketCap
To date, Compound Finance has generated more than $770 million in loans secured through cryptocurrencies such as ETH and stablecoins DAI, USDC and USDT. According to data from Dune Analytics, Compound Finance has almost 400 thousand active users. Without a doubt, one of the most popular and attractive protocols in decentralized finance.
What drives the price of Compound (COMP)?
On June 28, Compound Finance developers announced the creation of a new technology company called Superstate Funds. Through this, the protocol seeks to create a regulated government bond fund on the Ethereum blockchain. According to information provided by the protocol developers, Superstate raised $4 million in capital from investors such as ParaFi Capital, 1kx, Cumberland Ventures, Coinfund and Distributed Global.
The government bond fund that Compound wants to create through Superstate will use the technology to “maintain a complimentary secondary record of the shares of certain shareholders on one or more blockchains, initially the Ethereum blockchain.” In addition to this, it clarifies that it is not designed to invest directly or indirectly in tokens or cryptocurrencies.
With the launch of Superstate and the filing with the SEC for the creation of the new government fund, Compound Labs is more focused on building the infrastructure for the future of finance, bridging the traditional market with the blockchain-based financial ecosystem.
On the other hand, it seems that the whale activity and institutional investors are also behind the impressive increase in COMP over the past 7 days. According to @lookonchain, whales have been making significant moves with the token. Likewise, user @DefiIgnas highlighted that the new company created by Compound Labs, the appointment of a new CEO and whale activity have been the main drivers of COMP's price this week.
Continue reading: Compound Finance tests its new Comet version to become multi-chain
