Compound Finance has reached a settlement with crypto whale Humpy and his Golden Boys group over the allocation of COMP tokens to a yield-bearing protocol. The contentious Proposal 289 has been canceled, and COMP tokens will now be turned into a yield-bearing asset. This news has led to a 7% increase in COMP value, bucking the broader market downturn. Compound Finance is a leading DeFi lending protocol with over $3 billion in assets locked.
The settlement with Humpy involves the creation of a new staking product on Compound Finance. This product will allocate 30% of existing and new market reserves annually to staked COMP holders based on their stake size. The new staking product will be governed by the Compound DAO and audited by a designated security partner. The community, including Humpy and DeFi risk manager Gauntlet, has generally welcomed this news.
Humpy expressed full approval of the move, and Gauntlet stated support for exploring a Compound staking product. However, there are concerns about the governance security of Compound. StableLab’s Doo emphasized the need for Compound to take governance security more seriously to prevent similar events from happening in the future. They suggested implementing governance changes to increase security.
Overall, the settlement between Compound Finance and Humpy over the COMP token allocation has been met with positivity from the community. The new staking product aims to benefit COMP holders and enhance the platform’s governance structure. With a focus on improving governance security, Compound Finance is taking steps to prevent future controversies and ensure the stability of its protocol.
