Compound Implements Community-Driven Governance Proposals
Last week, Decentralized finance (DeFi) protocol known as Compound was able to implement its initial two community-driven governance proposals.
The launching of the protocol’s governance token (COMP) aimed at the facilitation of community-driven protocol upgrades and development is on the way.
First Governance Proposal For Compound
The community was given the opportunity to choose the assets they want to be added to Compound in September last year and most people chose Maker (MKR) and Tether (USDT). Hence, based on the result, the initial proposal asked the community whether Tether (USDT) should be supported by Compound protocol.
When the community voted, more than 90 percent said USDT should be supported and it was implemented on May 1, 2020. In the proposal, USDT was presented as an asset that can be borrowed with its own interest rate. Nevertheless, there will be no support for USDT as collateral.
The support for USDT led to the development of a modified cToken contract by the Compound team which introduces support token transfer fees in underlying tokens.
“cUSDT is an upgradable cToken contract that has been modified to accommodate potential transfer fees in the underlying token. The cToken contract has been reviewed by OpenZeppelin and the Compound team.”
Second Governance Proposal For Compound
The second governance proposal for Compound was created on April 27 by DeFi app, Dharma. The purpose was to modify the interest rate mode for DAI on the platform because they thought it would offer a better user experience to capital suppliers, with little effect on borrowers.
The proposal was towards the creation of a stable upward trajectory for cDAI interest rates, to replace the existing system in which there is earning of minimal interest until more than 90 percent of cDAI is lent on the platform.
With a 97 percent approval rate, they passed Dharma’s proposal on April 30, 2019 and it was executed on May 3, 2020.
Featured image courtesy of Compound Medium. Source: Cryptopress.