DeFi Welcomes Compound Finance: What Investors Need to Watch for this Week
Weekly Analyst Thoughts
Compound Finance is a decentralized finance (DeFi) platform that allows cryptocurrency users to borrow and lend stablecoins and Ethereum tokens with smart contracts. This week, Compound released a governance token that allows users to use the platform to vote on crypto market proposals in a decentralized fashion.
Looking at the graph below, to say that Compound Token had a great week would be an understatement. However, as successful as the coin’s inaugural performance was, the total supply of Compound’s token is only 2.5 million, while only 100,000 of these have been distributed to the public. Thus, the 2.4 million tokens under the ownership of the Compound founders are locked up so that they can be sold on the market when it gets listed on Coinbase on June 23rd. With such, be prepared for price volatility in the coming week.
Jacob Stelter | Blockchain Analyst