Compound rolls out community governance system, with added support from Coinbase Custody

Compound has announced its community governance system and associated COMP token are now live. The new model hands control of the protocol over to COMP holders, enabling them to propose and vote on governance actions such as adding support for new assets. At the moment, token holders include existing shareholders of Compound Labs and the protocol’s current founders and team members.

Coinbase Custody almost simultaneously announced its is launching support for Compound’s new governance system and COMP token. The voting solution will allow clients to use their COMP holdings to participate in governance decisions directly or by way of a third-party without having to move the tokens out of cold storage. Today’s announcement also stated the custodian would open deposits and withdrawals for all Compound c-Tokens, cETH, cZRX, cUSDC, cBAT, cDAI.

Why it matters:

• The launch is a step forward for Compound in terms of decentralization, as the company removed itself from the decision-making process and handed these responsibilities over to a distributed set of token holders.
• While the number of token holders consists of only current team members and company shareholders, Compound reserved over half of the supply for users of the protocol. The team is planning to release more details on the distribution model in the coming weeks.
• Compound marks the second governance system supported by Coinbase’s custody arm. The custodian also launched a voting solution for Maker last fall (Oct. 2019). Aside from its flagship product, Coinbase now is a leading service provider for three of crypto’s most prominent activities: secure storage, staking, and governance.