Users of Compound, a decentralized finance (DeFi) lending solution, are now able to issue loans and borrow Tether (USDT), the largest stablecoin, following a recent poll of the protocol’s governance token holders.
There were 797,981.28 votes that were cast in support of the proposal to add USDT compared to only 85,580.73 votes against it. Polychain Capital reportedly had the largest number of votes. Geoffery Hayes, the founder and CTO at Compound CTO, also contributed a substantial number of votes in favor of adding USDT as a borrowing option.
This is notably the very first proposal that has been handled by Compound’s new governance mechanism. The DeFi protocol’s developers also introduced a community vote option, in 2019, to assess users’ level of interest in supporting new digital assets on Compound. Maker (MKR) and USDT received the most votes.
While Compound users have the option of supplying and obtaining loans in USDT, the leading stablecoin may not be used as collateral, as clarified in the proposal.
Dai and Circle and Coinbase’s USDC stablecoins are the most widely-used assets in the DeFi ecosystem, Loanscan data confirms. However, USDT remains the most liquid asset across the larger cryptocurrency market, as it claims more than 78% of the total market share.
As mentioned on its official website, Compound is an Ethereum-based “algorithmic, autonomous interest rate protocol built for developers, to unlock a universe of open financial applications.”
The Compound development team works with Coinbase Custody, which helps secure custody for COMP, the protocols native token.
The DeFi protocol’s creators also work with Anchorage, which offers crypto custody solutions that come with trading, staking, and Compound governance options.
Additionally, Fireblocks may be used to “safely move assets between exchanges, wallets, and Compound.”
