Compound Crypto Money Market Helps HODLERS Earn on 5 Ethereum Tokens (ETH, BAT, REP, ZRX and trueUSD)
Compound Will Launch Money Markets For ETH Assets
Compound, a financial company, has decided to launch its own money market protocol on top of the Ethereum network. This new feature will allow individuals and institutions to earn interest over crypto assets without the need to negotiate interest rates with any peers directly. The markets will have their own dynamics for defining the conditions and they will be set automatically.
The software has been audited by Trails of Bits and Certora and it has been recently deployed on the ETH blockchain. Initially, the platform will support only four markets: Ethereum (via WETH-9), 0x Protocol (ZRX), Basic Attention Token (BAT) and Augur (REP). It will also have 26 hedge funds that will trade with the platform.
With this new platform, you can borrow and short these tokens using the infrastructure of the company, which automates and regulates most of the process in a secure way. The interest rates will be set via algorithms and smart contracts. They will range from 5 to 45 percent.
The CEO and founder of the company, Robert Leshner, has affirmed to the media that blockchain assets lack a fundamental financial infrastructure and effective interest rates despite how new and interesting they may be. Because of this, the CEO believes, the market has to be improved and Compound can be a part of the change.
Leshner has also affirmed that hundreds of trillions of dollars will be tokenized in the future, so the institutions that deploy the tokenization process will need to make these important first steps in order to establish the market. The CEO also believes that this new platform can bring some important improvements to the structure and prices that will be fairer to everyone involved in the process.
The startup is also focused on creating a stable coin based on its protocol as a way to call the attention of the financial institutions in order to give more liquidity to its upcoming market.
Compound is officially live:https://t.co/KYLRNdeduv
— Compound (@compoundfinance) September 27, 2018
You can access the services of this company via the Compound App, which uses Web3 browsers like Metamask or the Coinbase Wallet. You will also need an Ethereum address to participate. The company has a transparency dashboard that it is used to give a feeling of more transparency for the users and let them know that they are not being scammed by using this platform to trade.
However, it is important to notice that this technology should be considered experimental, as it is still very new, so you have to be careful and see for yourself if you should trust in it.
The company was created in 2017 by Robert Leshner and Geoff Hayes and it has received $8.2 million USD in Seed funding in May 2018. The round was led by big name companies like Andreessen Horowitz, Polychain Capital, and Bain Capital Ventures, with participation from Coinbase Ventures, Transmedia Capital, Abstract Ventures, South Park Commons, Compound VC, and Danhua Capital.