Peak in DeFi Lending Pushes Compound (COMP) Value to New Excessive at $ 570

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As Bitcoin and numerous altcoins soar to new all-time highs, merchants wealthy in cash however poor in money are more and more turning to decentralized funding platforms the place they will acquire their holdings to lift cash for brand spanking new investments.

Compound is likely one of the main DeFi credit score platforms, and up to now month the value of TVL and governance token has soared to new highs.

Whole worth locked in Compound. Supply: Defi Llama

Compound, which ranks third amongst DeFi credit score protocols, has locked down $ 4.55 billion in belongings on the platform and the COMP governance token has doubled in worth over the previous week. At present, COMP is buying and selling at $ 566, a brand new all-time excessive and a 325% improve because the begin of 2021.

Restrictions on shopping for shares underscore the necessity for DeFi

Whereas there aren’t any main bulletins that seem to have catalyzed COMP's present rally, the mission has not too long ago been built-in with Ledger's Lend platform, permitting pockets customers to work together with the Compound platform and lend their stablecoins.

On January 29, Compound co-founder Robert Leshner mentioned the shares purchase restrictions brokerage corporations similar to Robin Hood positioned on shares similar to AMC and GameStop.

In line with Leshner, all markets are affected by lengthy settlement instances as a result of Depository Belief & Clearing Company (DTCC) construction, and he prompt that & # 39; markets run on blockchains & # 39; as & # 39; the long-term reply & # 39; for the issues we’re presently going through. .

Lesner stated

“Quick settlement would remove a lot of the complexity, prices and capital necessities that plague T + 2 settlement. Robinhood shouldn’t have any credit score obligations or ought to flip in opposition to their very own clients. "

On the time, COMP was buying and selling at $ 241 and it’s doable that the additional consideration the GameStop fiasco delivered to the crypto and DeFi sector prompted some traders to present Compound and different decentralized change platforms a attempt.

COMP / USDT 4-hour chart. Supply: TradingView

COMP outbreak follows key board votes

On February 1, COMP proposal 36 reached the required threshold for a three-day group voting interval, which ended on February 12.

The proposal, which aimed on the "Group Autonomous Proposal (CAP) to extend the Collateral Issue (CF) of WrappedBTC from 60% to 75%" on the platform ", was handed by a large margin and might be sooner or later.

One other wave of shopping for adopted this announcement, pushing the value of COMP up 54% from $ 382 within the early buying and selling hours on Feb. Four to $ 555 on Feb. 5.

As the eye of institutional traders grows and massive title influencers like Elon Musk and Mark Cuban tout the advantages of decentralized funding and the returns it supplies, the present upward development in TVL is poised to maneuver greater as symbolic values ​​and protocol engagement. rise to new highs.