About

Compound Finance is a decentralized money market and lending protocol built on Ethereum. Its Compound III (Comet) protocol enables users to borrow or lend from single-collateral pools of “base assets.” Compound III supports base assets (e.g., USDC, WETH, etc.) on Ethereum, Polygon, Base, and Arbitrum. Compound III has dynamically adjusted interest rates, which are algorithmically determined based on the supply and demand dynamics within the market.

History

Compound Finance was founded in 2017 by Robert Leshner and Geoffrey Hayes to create a decentralized protocol for algorithmic money markets on Ethereum. The project launched on mainnet on Sept. 27, 2018, later upgrading to its Compound v2 in May 2019. The upgrade introduced additional assets, individual risk models, and smart contract gateways for each asset, among other features. Compound’s initial version, Compound v1, was deprecated in June 2019.

The ERC-20 COMP token was deployed on Ethereum in March 2020, and the project transitioned to community governance in June 2020 following the token’s launch.

Compound III went live on mainnet in August 2022 following a successful COMP Governance proposal. The deployment enabled borrowing of USDC using ETH, WBTC, LINK, UNI, and COMP as collateral.

Additional deployments are detailed below:

• In March 2023, Compound III was deployed to Polygon, allowing users to use WETH, WBTC, and MATIC as collateral to borrow USDC.
• In May 2023, Compound III was deployed on Arbitrum following the execution of proposal 160.
• In August 2023, Compound III was deployed on Base, enabling ETH and cbETH as collateral to borrow bridged USDC (USDbC on Base).

Compound v2, has completed its ninth Phase towards its deprecation. Based on a commercially reasonable search, no verifiable information on the total planned number of phases could be found.