Compound v3 “Comet” was launched with huge support for a single borrowing model. It is now getting a big update, which is the third version of Compound.
After a successful vote in the Compound community, version 3 of the lending protocol was released on August 26.
There Will Only Be One Method Of Borrowing In Compound Version 3.
With the release of version 3, codenamed “Comet,” Compound introduced widespread support for a single borrowing model, i.e., Compound transitioned from a pool-risk borrowing model to a single-asset borrowing strategy. Under the new system, users can borrow a single interest-bearing asset, starting with USDC.
Users can borrow USDC with ETH, wBTC, LINK, and UNI. It is possible to withdraw the collaterals that were deposited, but you will not receive any interest.
Compound’s Founder Robert Leshner commented in response to changes to the collateral model:
“While you won’t receive interest on collateral anymore, you will be able to borrow more; with less risk of liquidation and reduced liquidation penalties; while spending less on gas,’
More Control Goes To The Community
The primary objective of Compound was to give the ruling group additional authority. To increase involvement, the governance process will be managed by a single smart contract dubbed a “Configurator” for each deployment, rather than several contracts for each request.
Compound also gave up sole authority over any future deployments and market parameter modifications in the community.
Forks Are Under The Command of Compound’s Third-Generation Control System
Compound’s codebase now contains a commercial license. The purpose is to control unauthorized forks by demanding governance consent for requests to alter or copy the software.
A Better Overall Feeling For Users
The Compound v3 user interface has been revamped to enhance the user experience. It redesigned its risk management/liquidation engine to increase usability and fund security.
Developers may leverage the protocol’s increased account management tools to construct more decentralized apps (dApps) (dApps).
According to Leshner, the upgrades will make Compound a more effective and capital-efficient lending approach.
Compound is a free and open-source interest rate protocol for building innovative financial tools. Its protocol is a widely used Ethereum-based system with thousands of users and dozens of apps that integrate Compound. To adapt interest rates in the money market to changes in asset supply and demand, Compound provides a web interface.
Compound is a startup company that started in August 2017 and is headquartered in San Francisco. It was established by Geoffrey Hayes and Robert Leshner.
Compound Labs and Compound Crypto are both brands under which the corporation operates.