Compound Finance has quickly grown into one of the largest DeFi applications on the market. For those unfamiliar with Compound, please take a moment to get caught up via our review here.
At the time of writing, Compound markets have amassed $148M in outstanding lending supply with over $45M active loans being taken out through the platform. With 7 different digital assets currently supported, the time to vote for new assets has come.
Compound Finance Voting Overview
Voting will last for 14 days, ending on September 11th at approximately 6PM EST. Out of all the assets proposed, the top two will be added to the platform.
Seeing as Compound does not utilize a native token, voting on the network is weighed based on usage of the protocol. Rather than traditional blockchain governance schemas granting each wallet one vote, this system was intentionally designed to favor those who are supporting the network the most.
“All Compound protocol users will be eligible to participate in the community vote, weighted by usage of the protocol (measured by lifetime interest earned + interest paid). This is an experimental “Sybil-resistant” voting mechanism, which is designed to allocate governance proportional to impact.”
How to Vote
Voting is quite simple. Visit the voting page and connect either your Coinbase or Metamask wallet. From there, Compound analyzes the total amount of interest loaned and paid to the platform in exchange for a certain number of votes.
Interestingly enough, voting weight can change up until voting ends. Simply put, if you have yet to use Compound and are eager to get involved, you have 13 days to get started and earn voting potential.
Current Standings
Here’s how the votes are currently panning out as of August 29th, less than 24 hours after voting was launched.
| Asset | Ticker Symbol | Number of Votes |
|---|---|---|
| Maker | MKR | 357,694 |
| TrueUSD | TUSD | 77,669 |
| Decentraland | MANA | 17,770 |
| Tether | USDT | 16,057 |
| Synthetix | sUSD | 11,692 |
| Flexacoin | FXC | 7,837 |
| Paxos Standard Token | PAX | 2,540 |
| Ampleforth | AMPL | 2,291 |
| Numeraire | NMR | 1,631 |
| OmiseGo | OMG | 1,520 |
| Loom Network | LOOM | 814 |
| Huobi Token | HT | 168 |
| Total | 497,688 |
As you can see, Maker (71%) and True USD (15.6%) are currently dominating this round of voting.
Due to Maker’s upcoming Multi-Collateral Dai implementation, it would seem that Maker holders are eager to earn additional interest on their collateral. MCD will likely prompt more usage of the MakerDAO platform, thus requiring more users to purchase MKR to pay off their stability fees. Due to the lack of reputable exchanges currently listing MKR, Compound could serve as a vital piece of infrastructure for quickly acquiring MKR with little to no slippage.
As for True USD, it would appear that stablecoins continue to be a dominant use-case for digital asset lending markets at large. While Compound already supports both USDC and DAI, it’s surprising to see that stablecoins (TUSD, USDT, PAX, sUSD and AMPL) are currently holding 5 of the top 8 standings.
We’ll be sure to follow up once the voting has concluded. In the meantime, take this opportunity to vote for an asset you would like to have a new liquid interest rate and the ability to be used as collateral for lending and borrowing other digital assets.
With voting weight being subject to change, keep an eye on the swing of events as those who use the platform most could very easily come in and drastically change things at the last minute.
Cooper is the Editor of DeFi Rate and an active contributor to leading DeFi media outlets like The Defiant, DeFi Pulse, and Bankless. He works with early-stage teams through Fire Eyes DAO to incubate governance models and grassroots community development. He is an ambassador to Set Protocol and an author of a weekly publication called Token Tuesdays. To stay up with Cooper, follow him on Twitter.