Compound crypto exchange is a decentralized lending platform built on Ethereum. The platform was founded in 2017 by Robert Leshner. The exchange allows users to borrow and lend cryptocurrencies in a decentralized way.
Besides that, Compound is a crypto exchange that offers a variety of services to its clients, including margin trading, derivatives trading, and OTC trading.
The protocol is open-source and transparent, and it doesn’t require KYC or AML.
Markets
The Compound crypto exchange allows users to earn interest on their cryptocurrency holdings and to borrow against them.
As of writing, the Compound spot market supports these assets – DAI, ETH, USDC, ZRX, USDT, WBTC, BAT, REP, and SAI. The assets supplied to the platform are turned into cTokens. The spot market has 15 Compound trading pairs. CUSDC/USDC trading pair has the biggest Compound trading volume. Besides, the platform also supports perpetual and futures trading. These markets have 9 Compound trading pairs each. Note that Compound supports only crypto-crypto trading.
As mentioned before, Compound offers margin trading, derivatives trading, and OTC trading. With margin trading, users can trade on leverage, meaning they can borrow funds from the exchange in order to trade with more capital than they have in their account. This allows for the potential to make bigger profits – but also comes with the risk of amplified losses.
Derivatives trading on Compound allows users to trade contracts that derive their value from underlying assets. This can be done through futures contracts, which are agreements to buy or sell an asset at a later date for a set Compound crypto price. Though it can also be done through options contracts, which give the holder the right (but not the obligation) to buy or sell an asset at a later date for a set price.
OTC trading is a type of trading that takes place outside of traditional exchanges. On Compound, OTC trading is done through the use of a smart contract that allows users to trade directly with each other without having to go through an intermediary. This can be useful for trades that are too large to be placed on the order book of an exchange, or for trades that need to be settled quickly.
The native asset of the Compound platform is COMP. It is an ERC-20 token that is used to govern the platform. It gives holders a say in how the platform is run and how its fees are structured.
Surprisingly, there are no trading, deposit, or withdrawal fees on the Compound cryptocurrency exchange. The only Compound exchange fees users need to pay are standard gas fees.
Other Services
Compound cryptocurrency exchange has a few extensions that ease the trading process. One of these extensions is Advanced Transactions, which allows users to combine multiple transactions into one, this way saving gas costs. Compound III proxy contract is used for doing that.
Also, there is the Compound V3 Position Migrator. It allows users to transfer supported collateral assets and stablecoin borrow balances from the Compound V2 or Aave V2 markets to the Compound V3 USDC market on the Ethereum network.
Moreover, there's DeFi Saver, which allows users to set up automated liquidation protection and rebalance their Compound positions.
Lastly, there's Comp.Vote, which is where COMP token holders participate in the governance of the platform.
About the Company
Compound cryptocurrency exchange was founded in 2017 by Robert Leshner. The current headquarters are in San Francisco, California. In 2018, the company achieved $1 billion in total value locked into its protocol and launched COMP, its governance token. In 2019, Compound was named one of CNBC's Disruptor 50 companies.
Robert Leshner has a degree in economics. In the past, he worked as a project manager at Discover Financial Services, principal at HPM Partners, and project lead at Postmates. Besides, he also founded Safe Shepherd and was the co-chairman at the San Francisco Revenue Bond Oversight Committee. Additionally, he is a partner of Robot Ventures.
In June 2019, Compound was targeted by a hacker who was able to gain access to the company's Twitter account and post fake giveaways. The hacker also gained access to Compound's email accounts and Slack channel.
In October 2019, a security researcher discovered a flaw in Compound's smart contract that could have allowed an attacker to mint an unlimited amount of COMP tokens. The flaw was fixed within 24 hours.
As of writing, there are three versions of Compound. Compound V3 was launched on August 25, 2022.
