Fireblocks launches secure access to Compound for institutions

Fireblocks, an institutional digital asset security platform, announced an integration with Compound one of the largest lenders in decentralized finance. This integration will allow Fireblocks customers which consist of hedge funds, market makers, exchanges and others to tap into Compound’s money markets which offer interest rates as high as 8.5%. Typically users access Compound through web3 wallets such as Metamask, but Fireblocks offers more institutional-grade security using multi-party computation which eliminates single points of failure in order to secure asset transfers.

Why it matters

• Interest rates around the world are plummeting as central banks look to combat the recessionary forces brought on by the coronavirus. In this low and even negative interest rate environment, investors will be looking for ways to earn yield. Compound’s money markets are multiples higher than traditional debt instruments as a result of higher demand for digital dollars, which if investors are okay with some additional smart contract risk, could prove to be an attractive option.
  
• DeFi has mostly been a tool for crypto-native individuals to play around with up to this point. Institutions have largely remained on the sidelines due to the lack of supporting infrastructure, however, this integration could bring in bigger names such as Genesis, Galaxy Digital and Prime Trust to begin earning yield on their assets held in custody.