Compound Finance is about to launch its own blockchain.
The aim is to integrate more assets from other registers.
The COMP has grown by 40% since the beginning of December.
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The DeFi lending and borrowing platform Compound Finance is launching its own distributed register to enable the transfer of value and liquidity.
Compound Finance pioneered liquidity farms, being one of the first to launch incentives for the distribution of governance tokens in June 2020. The DeFi protocol now goes one step further with its latest product, the Compound Chain.
The new Compound Chain has been described as being able to store and transfer value and liquidity between peer registries at low cost. In other words, it is inter-chain interoperability.
Today, we are pleased to present the white paper on the Compound Chain, a distributed registry capable of transferring value and liquidity between peer registries.
Another Ethereum rival?
One of the objectives of the new registry is to bring more assets to the Compound ecosystem, without necessarily competing with Ethereum :
Compound Chain“ is a tool that could bring more assets into the protocol from a variety of registers, e.g. Polkadot, Solana, Optimism PBC, Quorum, Celo, etc. It is designed to complement Ethereum contracts, be controlled by the governance of the COMP, and extend the effects of the DeFi network.
During a virtual DeFi summit on Wednesday 16th December in Bangkok, Thailand, its CEO and founder Robert Leshner declared this to be a priority objective :
Over time, more real-world assets [will be added] as the Ethereum blockchain integrates them.
The white paper adds that it will be a stand-alone blockchain preparing for the rapid adoption and growth of various Tokenized assets from new registries, including ETH 2.0 and Central Bank Digital Currencies (CBDCs).
The CASH will be created through a loan, similar to the creation of the DAI on MakerDAO, and will be used to pay transaction fees. Lending, holding and staking of CASH may also generate interest.
The announcement added that the team is actively working on a testnet with a limited set of features, which is scheduled for release next quarter (Q1 2021).
The course of the COMP
Compound’s COMP token, which started the DeFi boom, rose by 13% on 18th December with the whole of the crypto market. At the end of the day, it was trading for 157 dollars, down from its daily opening price of 178 dollars.
The COMP was up 7% this week. It had already risen by more than 40% in December, as it recovered from a two month lull. The token is still down 36% from its peak of $245 in June.