Peer-to-peer protocols facilitate collateralized and uncollateralized loans directly between market participants. Unfortunately, decentralization forces significant costs and frictions onto users; in every protocol reviewed, lenders are required to post, manage, and (in the event of collateralized loans) supervise loan offers and active loans, and loan fulfillment is often slow & asynchronous (loans have to be funded, which takes time.)
To solve these issues, a decentralized system was developed for frictionless borrowing of Ethereum tokens without the flaws of existing approaches. This solution enables proper money markets to function and creates a safe positive-yield approach to storing assets. There are currently two types of cTokens: CErc20 and CEther. Though both types expose the EIP-20 interface, CErc20 wraps an underlying ERC-20 asset, while CEther wraps Ether itself. Each asset supported by the Compound Protocol is integrated through a cToken contract, an EIP-20-compliant representation of balances supplied to the protocol.
The Compound Protocol is a protocol on the Ethereum blockchain that establishes money markets, which are pools of assets with algorithmically derived interest rates based on the supply and demand for the asset. An asset’s suppliers (and borrowers) interact directly with the protocol, earning (and paying) a floating interest rate without having to negotiate terms such as maturity, interest rate, or collateral with a peer or counterparty. Each money market is unique to an Ethereum asset (such as Ether, an ERC-20 stablecoin such as Dai, or an ERC-20 utility token such as Augur) and contains a transparent and publicly-inspectable ledger, with a record of all transactions and historical interest rates.
Who are the founders of Compound USD Coin (CUSDC)?
Compound was founded by veteran entrepreneurs Geoffrey Hayes and Robert Leshner.
What is Compound USD Coin (CUSDC) used for?
Delegate
Users can delegate votes from the sender to the delegatee. They can delegate to 1 address at a time, and the number of votes added to the delegatee’s vote count is equivalent to the balance of their token in the user’s account.
Borrow
Users who wish to borrow and have sufficient balances stored in the Compound may borrow. This is executed when the user’s account value is checked and sufficient collateral is analyzed. If successful and approved, the system will update the user’s borrow balance, transfer the tokens to the user’s Ethereum address, and update the money market’s floating interest rate.
Purchase computing power
Without waiting for an order to fill or requiring off-chain behavior, dApps can borrow tokens to use in the Ethereum ecosystem, such as purchasing computing power on the Golem network.
Finance ICOs investments
Traders can finance new ICO investments by borrowing ether and using their existing portfolio as collateral.
Mint tokens
By minting cTokens, users earn interest through the cToken’s exchange rate, which increases in value relative to the underlying asset and gives them the ability to use cTokens as collateral.
Earn profits
Traders looking to short a token can borrow it, send it to an exchange, and sell the token, profiting from declines in its overall value.
How is Compound USD Coin (CUSDC) unique?
The Compound protocol is governed and upgraded by COMP token-holders, using three distinct components; the COMP token, the governance module (Governor Bravo), and Timelock. Together, these contracts allow the community to propose, vote on, and implement changes through the administrative functions of a cToken or the comptroller. Proposals can modify system parameters, support new markets, or add new functionality to the protocol.
cTokens are the primary means of interacting with the Compound Protocol; when a user mints, redeems, borrows, repays, liquidates a borrow, or transfers cTokens, they will do so using the cToken contract. Users are able to borrow up to, but not exceeding, their borrowing capacity, and an account can take no action (e.g., borrow, transfer cToken collateral, or redeem cToken collateral) that would raise the total value of borrowed assets above their borrowing capacity; this protects the protocol from default risk.
COMP token-holders can delegate their voting rights to themselves or an address of their choice. Addresses delegated at least 25,000 COMP can create governance proposals; any address can lock 100 COMP to create an autonomous proposal, which becomes a governance proposal after being delegated 25,000 COMP.
When a governance proposal is created, it enters a 2-day review period, after which voting weights are recorded, and voting begins. Voting lasts for 3 days; if a majority and at least 400,000 votes are cast for the proposal, it is queued in the timelock and can be implemented 2 days later. In total, any change to the protocol takes at least one week.
How many Compound USD Coins (CUSDC) are in circulation?
It has a circulating supply of 26,644,274,754 CUSDC and a total supply of 26,616,957,875 CUSDC.
How is the Compound USD network secured?
The security of the compound protocol is the highest priority of the development team. Thus, all contract codes and balances are publicly verifiable, and security researchers are eligible for a bug bounty for reporting undiscovered vulnerabilities. The protocol’s smart contracts will be publicly accessible and completely free for machines, dApps, and humans.
How do I buy Compound USD Coin (CUSDC)?
The CUSDC token can be used for a wide range of purposes, like staking and governance.
CUSDC tokens can be easily purchased by following the following steps.
Open an account with the crypto trading platform.
* Transfer the specific amount of your fiat currency to your account.
* Wait for your deposit to be confirmed and buy CUSDC through your trading account by swapping with BTC, ETH, or USDT pairs.
Which Cryptocurrency Wallet Supports Compound USD Coin (CUSDC)?
The PTPWallet platform supports many cryptocurrencies, with CUSDC soon to be included. Because of its vast use case, PTPWallet has grown to become one of the most used platforms, as it serves as an exchange and an engine to discover other cryptocurrencies. The platform offers a simple user interface, is supported by both Android and iOS devices, and comes with its own mobile wallet app.
