COMP Distribution and Governance Updates

Compound Digest - September 23, 2020

Highlighting the best of the Compound ecosystem. For more updates, join the Compound community on Discord, Twitter, and Comp.xyz.

Governance Updates

COMP Distribution Update

The original COMP distribution plan included an allocation of 775,000 COMP intended to be used by “the community to advance governance through other means — which will be announced at a future date.”

In a Medium post last week, Compound Labs CEO Robert Leshner provided further detail on how these 775,000 COMP have been distributed:

  • 500,000 COMP have been designated to Coinbase Earn until November 2021, at which point any remaining COMP will be sent back to the protocol’s reservoir contract

  • 275,000 COMP have been sent directly to the reservoir contract, to be allocated by the community through the governance process.

What this means is that the protocol now has 275,000 COMP in reserves that the community is empowered to re-allocate through governance, in order to incentivize future improvements to the protocol. For example, these reserves could be used to reward successful governance proposals or incentivize new third-party integrations. 

The Compound community welcomes your thoughts on how best to leverage these new COMP reserves; please share your ideas in the Compound governance forum.

Completed Votes

Since the last newsletter, Proposals 22 and 23 have successfully passed through the Compound governance system with wide voting margins.

Proposal 22: New Feature: Borrow Caps

  • Status: Executed September 13th, 2020

  • Proposer: blck

  • Voting Results: 805,960 For and 15,015 Against

  • Summary: A new comptroller with a “Borrow Caps” feature has been implemented, allowing Governance to limit the total quantity of borrowing in a market. Borrow Caps can be used to limit irrational activity, or to potentially limit the total value-at-risk that suppliers of an asset face (due to bugs, attacks, or unforeseen catastrophes).

Proposal 23: Upgrade cUSDC Interest Rate Model

  • Status: Executed September 21st, 2020

  • Proposer: Dharma

  • Voting Results: 427,750 for and 0 Against

  • Summary: Submitted by Dharma on behalf of Arr00, Proposal 23 updates cUSDC’s interest rate model to the LegacyJumpRateModelV2 that is currently used for the cDAI and cUSDT markets (base rate of 0%, 4% at 80% utilization, and 25% at 100% utilization). This proposal standardizes the interest rate models for all stablecoins on Compound.

Potential Governance Proposals

The first Compound Autonomous Proposal (CAP), Set Pause Guardian to Community Multi-Sig, currently has 71,152 votes delegated to it, and requires 100,000 in order to move into the formal voting process. Consider delegating your support to the CAP, or follow this guide to create your own if you have at least 100 COMP.

Ongoing Discussions

See below for highlights from the Compound governance forum, and join in the discussion:

  • Adding New Markets to Compound” - @hayesgm describes the steps taken to deploy the cUNI cToken contract , which can serve as a guide for developers looking to add new markets to Compound.

  • Call to Action” - @rleshner encourages the community to use the protocol’s larger COMP reserves to incentivize protocol upgrades like gas optimization, governance bounties, and new markets.

  • Distribution of COMP token to early users, pre-COMP distribution period” - @Andre1 suggests that the Compound protocol automatically issues COMP to early users, similar to the path taken by Uniswap.

  • Adding COMP as an asset?” - @compoundbart suggests adding COMP as the next supported market on Compound.

Be sure to either vote on proposals with your COMP, or delegate your COMP voting rights to a representative of your choice.

Markets Update

The current supply on Compound is at $1.7B from ~36k unique addresses. In the past seven days, approximately $1.1B  (gross) was added to the protocol, in 5.9k transactions. 46% of this volume was DAI, 33% was USDC, 17% was ETH, and 2% was WBTC (source). 

Open borrowing is at $957M from 5.2k unique addresses. In the past seven days, approximately $425M (gross) was borrowed from Compound in 1.2k transactions. 81% of this volume was DAI, 11% was USDC, 3% was ETH, and 3% was USDT (source). 

For live figures please refer to our Markets page.

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