Compound [COMP] staged a sharp price recovery, following a daily increase of 22.46% as expanding trading activity triggered renewed market attention to the decentralized lending protocol. The price rally notably marked a bullish turnover for the token after struggling through an extended period of declining prices.
As per CoinMarketCap data, COMP’s 24-hour Spot trading volume increased by 975.2% to $143.8 million, which suggested significant growth in market participation. This sudden growth in activity followed the token’s price recovery from its recent lows, reinforcing its position among the day’s top performing cryptocurrencies.
Besides, the rally extended beyond the spot markets, as the derivatives traders also substantially increased their exposure.
Derivatives activity signals growing speculative interest Compound’s derivatives market registered an even sharper daily increase as its Futures trading volume skyrocketed 1,523.12% to $243.02 million in .
Additionally, Open Interest (OI) also climbed 103.58% to $37.85 million in 24 hours, highlighting significant growth in outstanding futures positions. This simultaneous expansion in both volume and OI suggested fresh leveraged participation instead of a merely increased trading turnover.
The derivatives volume notably exceeded the spot volume, which reflected the considerable role of Futures trading during COMP’s price rally. Here, it is also crucial to note that with leverage expanding sharply, COMP also faced greater exposure to potential liquidations in case of sudden price fluctuations.
Besides that the token’s exchange holdings offered another significant consideration as far as the rally’s sustainability is concerned.
Source: COMP Open Interest on CoinGlass Exchange reserves climb despite COMP’s recovery According to CryptoQuant, COMP‘s USD-denominated exchange reserves surged 21.42% in 24 hours as of writing, reaching roughly $32.8 million. The surge notably accompanied Compound’s rapid price expansion, which further raised the dollar value of exchange-held assets.
The exchange reserve expansion therefore did not necessarily confirm an equivalent surge in the number of COMP tokens on exchanges. However, the elevated reserve valuation still highlighted the significance of monitoring exchange balances as the trading activity intensified.
Specifically, a persistent increase in actual exchange-held token balances could create additional selling pressure in case the token holders decide to distribute. However, for now, the figures alone offered insufficient evidence of increased token deposits or confirmed selling activity.
Source: COMP Exchange Reserve USD on CryptoQuant Can COMP extend its recovery toward $30? Compound’s weekly technical structure highlighted a strong recovery from the $15.69 region, with the bulls reclaiming the significant $21.31 support level. As the breakout unfolded, COMP pushed towards the $25.95 region, bringing the $30 resistance level into the spotlight.
Interestingly, the Directional Movement Index indicator favored the buyers, with the +DI signal reaching 26.30 against the −DI signal at 12.52. Notably, the widening gap between the directional signals validated the bullish picture, as the ADX stood at 21.38.
COMP, however, was yet to overcome the $30 level, which previously acted as a crucial resistance region. Ultimately, COMP’s price recovery retained a bullish picture, technically supported by the improving directional strength.
A confirmed breakout above the $30 weekly resistance would be crucial to reinforce the case for further gains.
Source: COMPUSDT Chart on TradingView Final Summary COMP’s rally attracted heavy futures activity, with Open Interest more than doubling. COMP’s bullish recovery strengthened, but breaking $30 remains crucial for further gains.
Návrh pro Compound převádí přibližně 5,08 mil. USDC z EPCF a 356 ETH z výnosů Chainlink SVR do komunitní multisig peněženky, která vyžaduje souhlas pěti z devíti signatářů.
Proposal 613 was cancelled by the Proposal Guardian on 7 October. I am putting forward a narrower alternative for discussion.
It does not close the EPCF. It changes who holds the keys. The EPCF and the mainnet SVR revenue would move from Safes the Foundation controls alone to the Community Multisig, which needs five of nine signers.
The funds Pool Holdings on 8 October Who can move it today After this proposal EPCF 500,000 USDC and 4,583,411 USDC supplied to cUSDCv3 2-of-3 Safe; two signers are Foundation nominees Community Multisig, 5-of-9 Mainnet Chainlink SVR 355.95 ETH 2-of-4 Safe “controlled by the Foundation” Community Multisig, 5-of-9 The same two addresses, 0x0660…6bF2 and 0xA415…897E, are owners of both Safes and meet both thresholds on their own.
How this differs from Proposal 613 Proposal 613 closed the EPCF and sent everything to the Governor Timelock. @pennblockchain objected that this removes the fund’s rapid-response role, and other delegates said the same in their vote rationales.
That objection is fair, and this alternative accepts it. The EPCF keeps its purposes, its size and its 48-month term. Emergency deployment stays available.
The problem is sole control The DAO has already decided what custody of DAO funds should look like. The Treasury Escrow is owned by the Governor Timelock. The TMC needs four of six signers to start a withdrawal. Every withdrawal waits out a cooldown, the Community Multisig can block it, and governance can reclaim the assets.
The EPCF and the SVR revenue have none of that.
EPCF. Proposal 535, Section 6, gives the Foundation two of three signers. Section 4 lets it deploy funds “at its discretion when, in its judgment” a threat qualifies. SVR. The Foundation’s March update says the Safe “is controlled by the Foundation and held in trust for the DAO”. It adds that there are “no explicit governance instructions” for the funds. Together that is about 5.08M USDC and 356 ETH of DAO money behind two keys from one organisation.
If the treasury itself sits behind a committee, a cooldown and a safeguard, why do these two pools sit behind nothing?
Why this matters now Section 3 of Proposal 535 lets the Foundation:
convert a portion of EPCF assets into COMP and delegate such COMP for the purposes of participating in Compound governance.
The V2 reserves show how that kind of discretion has been used. Proposal 536 gave the Foundation 8.42M DAI “exclusively to support protocol operations and governance continuity”. Its text never mentions delegation or using the entirety of the funds to purchase COMP and vote on its own proposals. The chain shows the following.
Date (UTC) What happened Transaction 9, 15 and 25 April 7,988,003 USDC left the V2 Reserves Safe for one address, which forwarded all of it to a Binance deposit address by 26 April 1, 2, 3 14 April The Safe delegated its COMP voting power to the Foundation tx 5 May, 09:46 344,780 COMP arrived in the Safe, 58 minutes before the voting snapshot for Proposals 580 and 582 tx 5 May, 14:46 The Foundation voted 912,717 COMP for Proposal 580, which created the TMC tx 20 and 21 May 100,000 COMP left the Safe for that same address and was forwarded to a second wallet 1, 2 22 May to 10 September That wallet deposited COMP at eight exchanges: Binance, Bybit, OKX, Coinbase, KuCoin, Bitget, Gate.io and Bitvavo. Net of what came back, all 100,000 was on exchanges by 10 September wallet 2 September 900,261 USDT arrived in the Safe from that wallet tx 3 and 10 September A further 50,000 COMP took the same route 1, 2 As of 8 October that wallet has sent 213,800 COMP to exchanges and received 93,049 back. It still holds 29,250.
The Foundation’s 28 September statement says “there has been no trading”. Trades inside an exchange are not visible on-chain, so I cannot say how much was sold. The Foundation can. It has not published its agreement with the trading firm or the purchase, transfer and disposal records. None of this activity is reported in the “Transparency Threads”.
I have called this misappropriation, and the Foundation disputes that.
Another wallets activity also raises similar questions. 0xb164…6432 delegates to the Foundation’s voting address. It received 60,028 COMP before the Proposal 535 snapshot in February and sent all of it to the same Binance deposit address 4 hours 25 minutes after voting closed. In May it received 100,024 COMP before the snapshot for Proposals 580 and 582, and began sending it back 28 minutes after voting closed.
Why the Community Multisig It is nine organisations, not one. Five of nine must sign. It already holds the DAO’s safeguard roles. It is the Pause Guardian, the Safeguard on the Treasury Escrow and the Proposal Guardian. It is fast. On 7 October it executed a 5-of-9 transaction less than nine hours after Proposals 612 and 613 were queued. It was suggested at the start. In February, @blockful proposed a DAO-elected council or the Proposal Guardian members as managers, so that responsibility would not rest solely with the Foundation. I have criticised this multisig’s composition, and I stand by that. This proposal is the minimum, not the ideal. Five of nine signers from nine organisations is a stronger check than two signers from one.
Compound DAO hlasuje o prodloužení klíčové lhůty pro převody z pokladny ze 2 na 10 dní. Návrh č. 612 zatím podporuje 1,75 milionu hlasů COMP, zatímco 921 000 hlasů je proti.
Compound DAO is voting on whether its treasury should have to wait longer before moving money. Proposal 612 would stretch key treasury delays from two days to ten, giving COMP holders more than a week to react before funds leave.
The vote is already lopsided. A wallet linked to delegate Humpy has cast 1.75 million COMP votes in support, enough to push the proposal past quorum. Against votes sit at 921,000.
What Proposal 612 actually changes Ugur Mersin submitted the proposal on October 2, 2026. Voting opened on October 4 and is scheduled to wrap up on October 7.
The core change targets two settings. The Treasury Escrow withdrawal cooldown would rise from 2 days to 10 days. The Treasury Timelock minimum delay would also climb from 2 to 10 days.
The proposal also sets an expiration on the Escrow at 17 days. That creates a seven-day withdrawal window after the ten-day cooldown ends. If funds are not withdrawn in that window, the opportunity lapses.
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Proposal 612 would give the Governor Timelock explicit roles as both executor and canceller over the Treasury Timelock. The main governance contract would hold the power to push treasury actions through, and also the power to kill them.
The stated goal is to line up treasury execution timelines with Compound’s full governance process. A two-day window is shorter than the time it takes the DAO to propose, debate, and vote on almost anything.
Why the treasury is under a microscope The proposal did not appear out of thin air. It follows recent activity by the Treasury Management Committee, or TMC.
On September 29, 2026, the TMC transferred $3 million in stablecoins. It then deployed $2 million USDC into a Uniswap V3 COMP position. The two-day delays governing these moves were set under the 2026 Treasury Management Program.
Recent accusations asserted that the Compound Foundation swapped 8.42 million DAI for roughly 344,780 COMP shortly before important proposal votes. Those are allegations, not findings, but they help explain why treasury oversight has become a front-burner issue.
Humpy returns to the spotlight Humpy has a history of large COMP accumulation and has been involved in governance proposal dynamics across various DAOs.
The 921,000 COMP voting against shows the proposal is not universally popular. Some delegates may see ten days as too slow for a committee tasked with managing capital in fast-moving markets.
What this means for Compound and COMP holders If Proposal 612 passes, every significant TMC action would come with a ten-day public waiting period and a clear path to cancellation through governance. Transfers like the $3 million stablecoin move or the $2 million USDC liquidity deployment would sit in a queue long enough for delegates to review, debate, and potentially block them.
A ten-day delay plus a seven-day withdrawal window means treasury actions could take more than two weeks from approval to completion.
The things to watch are straightforward. First, whether the vote holds through the scheduled October 7 close. Second, how the TMC adjusts its strategy under longer delays if the proposal passes. Third, whether the allegations involving the Compound Foundation’s DAI-to-COMP swap lead to further proposals targeting governance integrity.
Disclosure: This article was edited by Estefano Gomez. For more information on how we create and review content, see our Editorial Policy.
Compound Foundation odmítá obvinění, že zneužila přibližně 8,42 milionu DAI z rezerv V2 k ovlivnění hlasování o správě protokolu. On-chain data podle Bitquery ukazují přesun do COMP těsně před dvěma klíčovými návrhy.
The Compound Foundation is pushing back hard against accusations that it improperly used millions in idle protocol reserves to influence its own governance votes. The dispute, surfacing in Compound’s community forum on September 27, 2026, cuts to the heart of a question every major DeFi protocol eventually faces: who actually controls the DAO?
The allegations, filed by a community member identified as ugurmersin, center on roughly 8.42 million DAI that was moved from Compound’s deprecated V2 reserves to a Foundation-managed multisig wallet. Proposal 536, approved in February 2026, authorized that transfer with a specific mandate: the funds were to remain DAO-owned and could not be deployed for speculative trading or to cover Foundation operating costs.
The accusations in plain terms According to the forum post, what happened next was not what the proposal intended. On-chain data indicates that nearly all of the transferred DAI, approximately 99.98% of it, was converted into around 344,780 COMP tokens through what appears to have been trading desk activity.
The timing is the part that raised eyebrows. Those COMP tokens were reportedly delegated to a Foundation-controlled voting address just 58 minutes before the deadlines for Proposals 580 and 582. Both proposals passed. One shifted nearly all DAO treasury assets to the Treasury Management Committee, of which the Foundation is a signatory. The other advanced a major 52 million dollar V4 protocol initiative.
Blockchain analytics firm Bitquery has verified the on-chain timeline underlying the claims, which lends the allegations a factual backbone that makes them harder to wave away.
The Foundation’s response The Compound Foundation did not stay quiet. In a public statement, it denied that any assets were misappropriated for Foundation operations, arguing that the reserves remained DAO-owned throughout and that the evidence supports its account of events.
What the Foundation has not fully addressed, at least in public commentary so far, is the specific question of the timing. Converting DAO-owned DAI into COMP tokens and delegating those tokens to a Foundation voting address 58 minutes before governance deadlines is a sequence that needs more than a general denial to defuse.
The Foundation’s framing, that the assets stayed within DAO control, is technically plausible if the COMP tokens were held in a DAO-designated wallet. But the conflict-of-interest problem persists regardless of custody: a Foundation with signing authority over both the reserve multisig and the Treasury Management Committee voted with tokens derived from those very reserves on proposals that expanded the TMC’s power.
What this means for Compound and DeFi governance broadly The immediate risk is reputational. COMP token holders who were unaware of the reserve conversion now have reason to question whether their votes carry the weight they believed. If the Foundation could route 8.42 million in DAI through a trading desk to acquire and deploy nearly 345,000 COMP tokens before a critical vote, the power distribution within the DAO looks significantly different from what its governance documentation suggests.
The 52 million dollar V4 initiative that appears to have cleared governance partly on the strength of those tokens is now under a cloud. Even if the program is sound on its merits, the legitimacy of the vote approving it is being contested, and that opens the door to governance challenges that could delay or complicate V4’s rollout.
The dispute is still unfolding. The Foundation has denied the core allegations but the on-chain record is public, the timeline has been independently verified by Bitquery, and the community is watching how Compound’s governance responds to a challenge that strikes at its foundational promise of decentralized, conflict-free decision-making.
Disclosure: This article was edited by Estefano Gomez. For more information on how we create and review content, see our Editorial Policy.
The market takes ETH, wstETH, WBTC and cbBTC as collateral against USDC at loan-to-value ratios of up to 87%. Compound says borrowing is open to anyone, with approval required only for the 200,000 USDC in supplier rewards.
Compound Foundation has opened a USDC lending market that takes ETH, wstETH, WBTC and cbBTC at loan-to-value ratios of up to 87%, three weeks after relaunching the protocol around institutional credit.
The Institutional Market is the first product out of the $52 million program COMP holders approved in May, and it went live under multisig control that Compound governance cannot revoke. A delegate has asked COMP holders to change that. The Compound Governance Working Group says the arrangement sits within the program the DAO already approved and that moving control to governance is the intended outcome once the market's research phase ends.
The market lends USDC against ETH, wstETH, WBTC and cbBTC, and runs on Compound v3. Compound holds $1.53 billion in total value locked with $638 million borrowed against it, sixth among lending protocols on DefiLlama and up 23% over 30 days. Ethereum carries $1.42 billion of that, or 93%. COMP trades at $20.88, up 9% over seven days, for a market cap of $212 million.
"With today's Institutional Market launch, we are taking the first step toward building infrastructure to meet institutional client demands, including better capital efficiency, clearly defined risk, and a much higher standard of service," said Aaron Schnarch, executive director of Compound Foundation. "We are encouraged by the market demand, and look forward to launching additional capabilities over the coming months."
Oversubscribed At LaunchCompound says the market was oversubscribed on day one, with DeFi Saver, K3, KPK and Yearn taking part. The company gave no figure for how much was subscribed.
"Compound is combining the capital efficiency of onchain markets with the level of service institutional participants expect. The ability to access more efficient borrowing while working directly with a team that understands institutional requirements makes this a compelling new market for us," said Marcelo Ruiz de Olano, co-founder and CEO of KPK.
Four Assets, One BorrowThe collateral list is short and liquid: two forms of ether and two forms of wrapped bitcoin.
Compound's argument is that a market holding only those four assets can run higher loan-to-value ratios than one that has to price the tail, and that lenders capture better economics as a result. Borrowing is open to anyone. The approval process and a 100,000 USDC minimum deposit apply to the boosted supplier rewards, which run to 200,000 USDC paid pro rata over three months against a $20 million supply cap.
Compound's market page puts ETH at an 87% loan-to-value ratio, wstETH at 85%, and WBTC and cbBTC at 81%, with a $10 million borrow cap on each. Liquidation factors run from 93% on ETH to 86% on the two bitcoin assets, and liquidation penalties from 5% on ETH to 10% on WBTC and cbBTC.
The Foundation identified the market to delegates in July as the first V4 research-and-development comet, built under what it calls v3.5 and not part of the original roadmap, with the work funded inside the V4 program. Compound also says v3 has run four years without an exploit, a claim worth stating as the company's own.
Who Holds The KeysCompound delegate ugurmersin asked COMP holders on Sept. 9 to put ultimate control of the market under Compound governance, writing that the DAO "does not currently appear to have ultimate control over Institutional Comet" and that he could find no governance authorization for the structure or any way for COMP holders to revoke it. The proposal would leave day-to-day operation where it is while requiring the administrators to publish a full permissions map and transfer ultimate authority within 30 days.
The Compound Governance Working Group answered the same day with a permissions map. Risk parameters, collateral listings and reserve withdrawals sit with a 3-of-4 Safe whose signers represent the working group, the DAO's security service provider team, Gauntlet and the Foundation. Contract upgrades run through a proxy admin owned by a 4-of-7 Safe drawn from the same four entities. Emergency pause sits with Compound's existing 5-of-9 guardian, which covers every other market the DAO runs. In a DAO-controlled comet the first two layers sit with the governance timelock, the group wrote; here they do not, and approval of the program "should not be confused with a technical ability for COMP governance to revoke those permissions directly."
The group said it does not support the proposal's 30-day transfer deadline, and that the configuration layer has to move quickly while the market iterates on collateral, caps and parameters. On Sept. 10 it wrote that the form of governance for the comet is still being researched and needs a spec, engineering and an audit, with optimistic governance one implementation under study. It also said the market passed $12 million in collateral and was approaching $10 million in supplied USDC within 48 hours of launch.
The delegate narrowed the ask on Sept. 11: governance should be able to replace the administrators while the Safes keep every permission they hold today. "The Safes operate the market. Governance controls who is allowed to operate it," he wrote, arguing the pattern already exists in the Treasury Management Committee framework and needs no research phase. His stated reason for pressing now is V4 itself, which is due to be built with the same program money.
Mostly Still In ReserveCOMP holders approved the budget on May 8, with 1.88 million COMP in favor and none against, and it executed two days later. The Foundation made it public on Aug. 17 alongside four hires from Coinbase, Anchorage, NEAR and Maple. Schnarch, the executive director, was chief operating officer of Anchorage Digital and chief executive of Coinbase Custody. The two-year budget runs $28 million for operations and $24 million for growth, but only $14 million went to the Foundation's multisig; the other $38 million sits in reserve against milestones that include a staffed engineering team and a production v3 integration kit.
Shipping an institutional product three weeks in is the first of those milestones met in public. Whether the remaining $38 million follows is a DAO decision, not a Foundation one.
The $480 Billion LineCompound's boilerplate puts the protocol at "approximately $480B in deposits and borrowing volume" since 2018. Compound sits behind Aave's $17.5 billion and Morpho Blue's $9.6 billion in a lending category holding $50.2 billion across 639 protocols, with 3.1% of the total.
Compound wrote the template for onchain lending in 2018 and now holds less than a tenth of Aave's deposits, and the institutional market is its attempt to win back size on terms and service rather than rates. Compound calls it the first in a planned series built around different collateral types and borrower profiles.
CORRECTION: Borrowing is open to anyone and approval applies only to the supplier rewards; COMP holders approved the program in May and the Foundation made it public in August; the participant is K3. The has also been updated with the Compound Governance Working Group's account of the market's control structure and funding mandate, published on Compound's forum on Sept. 9 and 10, and with the exchange that followed.
Compound Foundation spustila institucionální USDC trh s kolaterálem v ETH, wstETH, WBTC a cbBTC a LTV až 87 %. Půjčování je otevřené všem; schválení je nutné jen pro 200 000 USDC odměn pro poskytovatele.
The market takes ETH, wstETH, WBTC and cbBTC as collateral against USDC at loan-to-value ratios of up to 87%. Compound says borrowing is open to anyone, with approval required only for the 200,000 USDC in supplier rewards.
Compound Foundation has opened a USDC lending market that takes ETH, wstETH, WBTC and cbBTC at loan-to-value ratios of up to 87%, three weeks after relaunching the protocol around institutional credit.
The Institutional Market is the first product out of the $52 million program COMP holders approved in May, and it went live under a control structure the DAO never voted on. The Treasury Management Committee administers the market and a separate Safe holds authority over its collateral and parameters, an arrangement a Compound delegate is now asking COMP holders to reverse.
The market lends USDC against ETH, wstETH, WBTC and cbBTC, and runs on Compound v3. Compound holds $1.53 billion in total value locked with $638 million borrowed against it, sixth among lending protocols on DefiLlama and up 23% over 30 days. Ethereum carries $1.42 billion of that, or 93%. COMP trades at $20.88, up 9% over seven days, for a market cap of $212 million.
"With today's Institutional Market launch, we are taking the first step toward building infrastructure to meet institutional client demands, including better capital efficiency, clearly defined risk, and a much higher standard of service," said Aaron Schnarch, executive director of Compound Foundation. "We are encouraged by the market demand, and look forward to launching additional capabilities over the coming months."
Oversubscribed At LaunchCompound says the market was oversubscribed on day one, with DeFi Saver, K3, KPK and Yearn taking part. The company gave no figure for how much was subscribed.
"Compound is combining the capital efficiency of onchain markets with the level of service institutional participants expect. The ability to access more efficient borrowing while working directly with a team that understands institutional requirements makes this a compelling new market for us," said Marcelo Ruiz de Olano, co-founder and CEO of KPK.
Four Assets, One BorrowThe collateral list is short and liquid: two forms of ether and two forms of wrapped bitcoin.
Compound's argument is that a market holding only those four assets can run higher loan-to-value ratios than one that has to price the tail, and that lenders capture better economics as a result. Borrowing is open to anyone. The approval process and a 100,000 USDC minimum deposit apply to the boosted supplier rewards, which run to 200,000 USDC paid pro rata over three months against a $20 million supply cap.
Compound's market page puts ETH at an 87% loan-to-value ratio, wstETH at 85%, and WBTC and cbBTC at 81%, with a $10 million borrow cap on each. Liquidation factors run from 93% on ETH to 86% on the two bitcoin assets, and liquidation penalties from 5% on ETH to 10% on WBTC and cbBTC.
The Foundation has described the market to delegates as an Institutional Comet built under v3.5, outside the V4 roadmap the DAO funded, to test an institutional use case. Compound also says v3 has run four years without an exploit, a claim worth stating as the company's own.
Who Holds The KeysCompound delegate ugurmersin asked COMP holders on Sept. 9 to move ultimate control of the market to Compound governance, writing that the DAO "does not currently appear to have ultimate control over Institutional Comet" and that he could find no governance authorization for the current structure or any way for COMP holders to revoke it. The proposal would leave day-to-day operation with the Foundation and the committee while requiring the administrators to publish a full permissions map within 10 business days and transfer ultimate authority within 30. It also notes that the committee's mandate from the DAO covers treasury management, not administering a lending market. The Foundation had not responded on the forum as of Wednesday.
Mostly Still In ReserveCOMP holders approved the budget on May 8, with 1.88 million COMP in favor and none against, and it executed two days later. The Foundation made it public on Aug. 17 alongside four hires from Coinbase, Anchorage, NEAR and Maple. Schnarch, the executive director, was chief operating officer of Anchorage Digital and chief executive of Coinbase Custody. The two-year budget runs $28 million for operations and $24 million for growth, but only $14 million went to the Foundation's multisig; the other $38 million sits in reserve against milestones that include a staffed engineering team and a production v3 integration kit.
Shipping an institutional product three weeks in is the first of those milestones met in public. Whether the remaining $38 million follows is a DAO decision, not a Foundation one.
The $480 Billion LineCompound's boilerplate puts the protocol at "approximately $480B in deposits and borrowing volume" since 2018. Compound sits behind Aave's $17.5 billion and Morpho Blue's $9.6 billion in a lending category holding $50.2 billion across 639 protocols, with 3.1% of the total.
Compound wrote the template for onchain lending in 2018 and now holds less than a tenth of Aave's deposits, and the institutional market is its attempt to win back size on terms and service rather than rates. Compound calls it the first in a planned series built around different collateral types and borrower profiles.
CORRECTION, Borrowing is open to anyone and approval applies only to the supplier rewards; COMP holders approved the program in May and the Foundation made it public in August; the participant is K3. The story has also been updated with the market's liquidation parameters and with a governance proposal filed Sept. 9.
Compound Foundation spustila povolený úvěrový trh jen pro institucionální dlužníky a oddělila ho od retailové části protokolu. Cílí tím na regulované hráče a RWA.
Compound Foundation launched a permissioned lending market on September 8 that only institutional borrowers can access, effectively carving the protocol’s liquidity pool into two distinct layers. Whitelisted participants get their own collateral sets, custom loan-to-value ratios, and tailored risk parameters, all separate from the retail-facing side of the protocol.
The move comes three weeks after Compound relaunched itself around institutional credit, and roughly a month after a DAO vote approved a $52 million development program, the largest funding initiative in the protocol’s history.
A protocol reinventing itself In August, Compound’s DAO greenlit the two-year, $52 million budget with $14 million released upfront and the rest gated behind milestones. The program is focused on onboarding regulated financial players: banks, asset managers, exchanges, and fintechs.
Leading the charge is a new executive team with deep roots in traditional finance. Aaron Schnarch, formerly CEO of Coinbase Custody, now serves as Executive Director. Christopher Donovan holds the COO role, Steven Liu is CPO, and Leo Eikelman fills the CTO seat.
The foundation says it has more than 10 confirmed partners, with discussions underway with over 20 additional potential collaborators.
Under the hood, the development program is building out compliance tooling including KYC and AML infrastructure, permissioned vaults, and integration kits designed to plug Compound’s lending rails directly into institutional workflows.
Why institutions, why now Compound’s total value locked currently sits at roughly $1.2B, down from a peak of $12B in September 2021. Since its 2018 launch, Compound has processed approximately $480B in total deposits and borrowing volume, and has recorded zero bad debt across its entire operational history.
The permissioned market structure directly addresses the single biggest objection institutions have had to DeFi participation: regulatory risk. By creating a walled-off environment where only whitelisted, KYC-verified entities can borrow, Compound sidesteps the compliance concerns that have kept most regulated capital on the sidelines.
The competitive landscape shifts The development program explicitly targets RWA support, which positions Compound to facilitate lending against tokenized treasuries, bonds, and other traditional financial instruments.
For existing COMP token holders, the strategic pivot carries both promise and risk. If institutional capital flows materialize, the protocol’s revenue and TVL could recover meaningfully from current levels. The milestone-gated budget structure provides some protection against the $52M being spent without results, but $14M is already out the door.
Disclosure: This article was edited by Editorial Team. For more information on how we create and review content, see our Editorial Policy.
Compound Finance schválil rekordní rozpočet 52 milionů USD a obměnil vedení, aby se zaměřil na institucionální DeFi. Hodnota uzamčených aktiv na platformě mezitím klesla na 1,2 miliardy USD z vrcholu 12 miliard USD v roce 2021.
Compound Finance has placed a $52 million bet and leadership renewal on its pivot to institutional DeFi. (Miguel Parera/Unsplash)Summary
Compound Finance overhauled its leadership and approved a record $52 million budget as it seeks to revive growth after its total value locked fell to $1.2 billion from a $12 billion peak in 2021.The protocol is pivoting toward institutional clients by developing real-world asset offerings, partner integrations and credit infrastructure designed to meet traditional finance compliance and technical standards.Industry executives say the new leadership team and sizable budget align with a broader shift in DeFi toward serving financial institutions, after the sector’s overall assets declined amid market weakness and security exploits.Compound Finance, one of the oldest decentralized finance (DeFi) lending protocols, replaced its leadership team and approved a $52 million budget on Monday to attract new capital after the value of assets locked on the platform tumbled to $1.2 billion from a peak of $12 billion in September 2021.
The company said it will now focus on attracting institutional users and will offer real-world assets, partner integration and credit infrastructure for traditional financial markets.
Compound pioneered decentralized lending when it started up in 2018, popularizing the concept of earning yield on crypto deposits without intermediaries. It said it has processed roughly $480 billion in deposits and borrowing volume since its inception. Over the past few years, it has lost ground to competitors such as Aave, which holds more than 11 times its TVL with $14.8 billion, DeFiLlama data shows.
As an industry, DeFi is operating from a weakened base. TVL across the sector has fallen by more than a third since the start of the year to roughly $70 billion, driven by a broad correction in the crypto market, compressed yields and a run of protocol exploits, including the $292 million KelpDAO hack in April. Still, the sector is forecast to reach $2.7 trillion by 2030, with tokenized real-world assets (RWAs) among the fastest-growing segments, according to a Standard Chartered projection.
"Now is a great time for initiatives like these, where real capital goes toward both the structural work and the bringing in of bright minds from the institutional sphere who can explain it to a risk committee in their own language,” said Gal Stern, chief business development officer at deBridge, over Telegram. “That combination is what brings institutional confidence back."
The new team includes Chief Operating Officer Christopher Donovan, who previously held the same role at the Near Foundation. Steven Liu, who scaled Maple Finance from $500 million to $5 billion in assets, joins as chief product officer and the former CEO of Coinbase Custody, Aaron Schnarch, becomes an executive director. Other appointees join from Anchorage Digital, HSBC, Broadridge Financial and Maple Finance, the company said.
"DeFi is a remarkable innovation; however, it has achieved limited institutional adoption," Schnarch said in a statement. "Current product offerings fall short of meeting the traditional finance bar, especially as it pertains to compliance and technical requirements."
The move is a logical response to the shift in DeFi's user base, according to Ran Hammer, chief business officer at Orbs.
"Retail participation is a fraction of what it was, and the chain has quietly become a venue for settlement, execution and interaction between financial institutions," Hammer said. “Since DeFi summer, the space has turned into something completely different, essentially a new financial layer for institutions. So bringing in leadership that speaks that language is exactly the right direction."
The size of the allocated budget, the largest approved by Compound's decentralized autonomous organization (DAO), may help underline its commitment.
"The $52 million and a bench with that much institutional experience is a serious move, and it should improve its execution," said Himanshu Sahay, co-founder and chief technology officer of crypto lending firm Arch Lending, but institutions will want more than credentials. They "aren't underwriting teams, they’re underwriting structures."
BonkDAO přišel o přibližně 20 milionů USD poté, co útočník s nákupem BONK za asi 4,4 milionu USD prosadil návrh při nízké účasti voličů. Stejný typ „apathy attack“ už dříve zasáhl i Compound.
Someone just walked into BonkDAO, spent roughly $4.4 million on tokens, and walked out with approximately $20 million from the treasury. Not by hacking smart contracts. Not by finding a zero-day exploit. By simply showing up to vote when nobody else did.
Welcome to the era of the “apathy attack,” a term coined by Dr. NickA (Nick Almond), Head of Governance at Jito Foundation, to describe a governance exploit pattern that has now hit DAOs from Compound to BonkDAO. The vulnerability isn’t in the code. It’s in the community.
How the BonkDAO attack unfolded On July 6, 2026, an attacker acquired enough BONK tokens to surpass the DAO’s 1% quorum requirement. Only about 2.9% of total participants actively voted on the malicious proposal, spread across just 7 wallets. The proposal passed and drained roughly 4.43 trillion BONK tokens, valued at approximately $20 million, from the treasury.
Post-attack, the stolen tokens were reportedly moved into a newly established “BONK 2.0” multisig DAO controlled by the attacker and their associates.
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The irony is thick: BonkDAO specifically set its quorum at 1% as a measure to deter apathy by making governance participation easy. Instead, the low threshold made governance capture trivially cheap.
Compound’s earlier warning shot Compound, one of DeFi’s most established lending protocols, faced its own governance crisis back in July 2024. Declining voter participation created the conditions for a similar exploit pattern, where proposals could be pushed through without meaningful community consensus. The incident was serious enough that Compound established the Compound Governance Working Group specifically to boost engagement and prevent future attacks.
Dr. NickA has drawn a direct line between these incidents, framing them as part of the same systemic vulnerability. The attack vector doesn’t target code. It targets disengagement. Historical data on DAO voter participation paints a grim picture. Turnout across token-weighted DAOs can dip below 10%, and in some cases falls as low as 0.1% to 3%.
The governance paradox The BonkDAO attack is especially instructive because the $4.4 million spent to acquire tokens yielded roughly $20 million in stolen assets. That’s nearly a 5x return on a governance exploit.
Some protocols have experimented with alternative models. Quadratic voting, conviction voting, and delegate systems all attempt to solve different aspects of the participation problem. But none have achieved widespread adoption, and the dominant model remains one-token-one-vote with fixed quorum thresholds.
What this means for investors Traders and investors evaluating DAO-governed protocols should be paying close attention to governance participation metrics. A protocol with consistently low voter turnout and a large treasury is essentially advertising its vulnerability. The ratio of treasury size to quorum cost becomes a rough measure of exploit profitability.
The emergence of “BONK 2.0” as an attacker-controlled entity adds another wrinkle. If stolen governance tokens can be reorganized into new structures that claim legitimacy, the attack doesn’t just drain a treasury. It fragments a community. Recovery becomes a legal, social, and technical challenge all at once.
Disclosure: This article was edited by Editorial Team. For more information on how we create and review content, see our Editorial Policy.
Po útocích na Compound Finance a Celer Network je kvůli migraci z Google Domains na Squarespace ohroženo dalších 124 front-end domén kryptoprojektů. Podle expertů byla při přesunu vypnuta 2FA.
Two prominent crypto projects have been exploited and many more could be at risk after two-factor authentication (2FA) was disabled, at the front-end, for projects using Google Domains amid a migration to Squarespace.
Posted July 11, 2024 at 2:27 pm EST.
The recent hacks of Compound Finance and Celer Network’s front-end domains on Wednesday revealed at least an additional 124 domains are at risk of exploitation by virtue of their registration with website-building company Squarespace, according to security experts.
Compound Finance, one of the largest decentralized protocols with a total locked value of nearly $2.2 billion, is hosting a phishing site, said Michael Lewellen, head of solutions architecture at blockchain security firm OpenZepplin, on X. He warned users not to interact with the website until further notice.
Another attacker, perhaps the same one or group, also attempted to take over the front-end domains of Celer Network. The team said on X that the takeover was intercepted and that their “investigation indicates that the attack vector likely involved third parties beyond our control.”
In a conversation with Unchained, the founder of blockchain network Glue and prominent white-hat hacker who goes by Ogle indicated that Compound Finance and Celer Network’s use of Squarespace to host their front-end websites is what allowed these exploits to occur.
“Right now, [Compound Finance is] exploited to the point that links are changed and so people can be phished,” he added. Phishing is a type of scam where exploiters use deception to make people reveal sensitive information or install malicious software.
Please avoid interacting with the compound[.]finance website until further notice.
It is part of the widespread domain compromise occurring right now. By visiting the site, or clicking any associated links, you will be putting yourself at risk. We and others are diligently…
— Compound Labs (@compoundfinance) July 11, 2024
The at-risk websites initially used Google Domains, but Squarespace acquired the Google Domains business, completing its acquisition of assets in September 2023.
The recent exploits were “almost certainly” from the migration of Google Domains to Squarespace, said Ogle. “What I’ve learned is that during that migration 2FA [short for two-factor authentication] was disabled.”
Compound Finance and Celer Network “probably did have 2FA enabled on Google, but then once it got switched over, not the case anymore,” he added.
“Google sold their domain business to Squarespace a few months ago and the forced migration of domains to Squarespace removed 2FA causing all these domains to be vulnerable and several have been hijacked,” said Bobby Ong, the co-founder of CoinGecko, on X.
Read More: $1 Million Bounty On Offer for Finding Bugs On Solana Validator Client Firedancer
Domains of Top Protocols At-Risk The number of crypto protocols joining the likes of Compound Finance and Celer Network may grow, as the pseudonymous founder of DefiLlama, who goes by the screen name @0xngmi on X, noted that 124 additional front-end domains of prominent crypto protocols are using Squarespace including Pendle Finance, Hyperliquid, dYdX, Nostra Finance, Axelar Network, Polymarket, Thorchain, Aptos Labs, NEAR, and Safe.
A spokesperson for Safe, a wallet infrastructure provider, confirmed with Unchained that Squarespace is involved with its front-end website, but emphasized they haven’t identified any abnormal activity and have systems in place to detect irregular changes.
“We currently remain unaffected,” Safe’s spokesperson said. “Our teams will continue to monitor the situation and keep our community and users informed.”
“As always, stay vigilant,” the spokesperson at Safe added. In a similar vein, the dYdX trading team said to Unchained over Telegram, “dYdX.exchange is secure with no detected vulnerabilities” and that they will also continue to “monitor the situation.” Axelar Network also has not identified any issues with its domain and will continue to track for any further developments, per a post on X.
Read More: 50% of Illicit Funds End Up At Centralized Crypto Exchanges, Chainalysis
The domains of these protocols — barring Compound Finance and Celer Network — remain unaffected. Yet Ogle says protocol team members should be worried as the situation is “not good” and that people should not go to any of these websites “under any circumstances until the official Twitter says it’s safe.”
At presstime, Compound(dot)Finance gets redirected to Compound-Finance(dot)app, in which the latter is flagged by Google as a dangerous site. “Attackers on the site you’re trying to visit might trick you into installing software or revealing things like your password, phone, or credit card number,” according to Google’s warning.
The message Google raises when people try to visit compound(dot)finance, which gets redirected to compound-finance(dot)app. If a user proceeds despite the flagrant, red warning, they’ll see a website that looks like a standard crypto protocol.
The interface of the phishing site is hosted by Compound Finance’s front end. Difference Between a Domain and Protocol While the domain websites of crypto projects may go down in the event of a hijacking, the actual protocols remain unaffected. People or bots can still interact with a project’s smart contract without going through a front-end website, Ogle said.
“You could transfer funds on the blockchain, you could go through their bridge, all that kind of stuff can happen without ever even using the website.” Even if a protocol’s front-end domain is attacked and “taken down by these hackers right now or whatever, you still don’t lose your money. You still have access to it.”
Representatives of Squarespace did not immediately respond to Unchained’s requests for comments.
UPDATE (July 12, 2024 10:03 a.m. ET) Includes status update of Axelar Network
