Create Ethereum Money Market DeFi Protocol like Compound
Create Ethereum Money Market DeFi Protocol like Compound
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Create Ethereum Money Market DeFi Protocol like Compound

DeFi Market is currently seeing massive growth in Crypto Space!. Decentralized Finance was commonly known as DeFi or Open Finance it refers to a financial application that is built on the top of blockchain networks it is easy to access financial services especially for those who are isolated from the current financial ecosystem. Most of the Decentralized applications are involved in the creation and execution of the smart contracts, Recently DeFi protocols continued to extend with different tokens with different projects with exclusive financial goals. Among them, Compound Protocol has created a huge demand in the DeFi because of it's unique benefits that made the Compound protocol to stay on the top of the DeFi protocol!

By this article, we have to see about what is Compound, how it works, and also how to create your own decentralized protocol like Compound!

Before getting into the topic let’s see the quick definition of Decentralized Finance (DeFi)

What is Decentralized Finance (DeFi)?

Decentralized Finance is an open-source and transparent financial ecosystem and it is suitable for everyone to operate without any central authority, Currently, DeFi based business are getting popular and attract n number of users, traders, and investors, Decentralized finance development process which involves the implementation of blockchain technology to develop many Decentralized applications (Dapps) for many Startups and entrepreneurs!

Further Read: What is Decentralized Finance (DeFi) - A Complete Startup Guide For Beginners!

Compound : Autonomous Interest Rate DeFi Protocol - Overview

Compound is a blockchain-based decentralized protocol that allows you to lend and borrow cryptocurrencies and it is an algorithmic money market protocol, Compound uses smart contracts to automate and manage the capital being added to the platform. Any users around the world can earn interest by connecting web 3.0 wallets like Metamask, Compound is a permissionless protocol that is anyone with a crypto wallet can interact easily with this protocol. it is mainly used by yield farmers to borrow assets and supply to other DeFi protocols.

How Does Compound Protocol Works?

The compound works with over-collateralization which means borrowers have to supply more value to avoid liquidation and it decides how much you are allowed to borrow based on the quality of assets. Compound supports a specific set of cryptocurrencies such as DAI, ETH, USDC, ZRX, USDT, So it is easy for everyone can be participated in this protocol around the world to lend and borrow crypto immediately without having the cost of dealing with a traditional financial intermediary

Benefits of Compound

The main value of the premise for Compound is it to allow users to earn a yield on their crypto assets without the involvement of an intermediary

Currently, the total supply of COMP is 10 million, Users can earn 42.3% from that supply when they regularly use Compound protocol.

In the Compound protocol, users can check their amount of interest paid per day on the user distribution page.

By voting a various governance proposals COMP holders can earn more COMP tokens

COMP Tokens are also called cTokens, if the user can locking up USDC in the protocol it generates to cUSDC which means you can automatically earn interest within the protocol.

Compound is like investing your money in a savings account, this is better than depositing your money into the bank.

Compound Token - COMP

COMP is the native token for a Compound protocol. COMP is earned by users for lending or borrowing assets and it is an ERC20 token, by putting ETH or other ERC20 tokens like USDC in the protocol users can get an equivalent amount of COMP tokens and they also can borrow crypto tokens. COMP token using on Ethereum wallet such as MetaMask, Coinbase wallet.

How to get a Compound interest in your crypto?

Compound allows people to interact with crypto in a new way, Once you can complete your quick KYC process in Compound protocol, you will get access to earn interest, If you are a lender you can earn up to 12% of interest on your crypto, If you are a borrower you have to put up 100 percent of the value of your borrow in an asset which compound supports, Compound takes off 10 percent what lenders earn in interest.

What type of assets are supported by a Compound ?

The supported assets for lending and borrowing on Compound which includes:

  • ETH
  • USDC
  • DAI
  • USDT
  • ZRX
  • BAT
  • REP and more

Where to Create a Decentralized Protocol like Compound?

Most of the business peoples are starting to utilize the DeFi in their business, but they didn’t have an idea to develop a decentralized protocol like Compound and they also need a Decentralized Finance Development Company to develop these kinds of protocols, there is a huge demand for creating a decentralized protocol, among them Developcoins build your DeFi based projects with an advanced decentralized ecosystem with Skilled DeFi Developers

Being a Pre-eminent DeFi Development Company, Developcoins helps to develop your own decentralized protocol like Compound and also became expertise in DeFi lending and borrowing development which helps us to provide the lending protocols with innovative features!

Not only we develop decentralized protocols, but We also offer a wide range of DeFi Development services which includes

DeFi Dapp Development
DeFi Yield Farming Development
DeFi Smart Contract Development
DeFi Token Development
DeFi Protocol Development like
DeFi DEX Protocol Development like Uniswap
DeFi Protocol Development like Falconswap
DeFi Protocol Development like AAVE and more

Want to create your own DeFi protocol like Compound? or need a DeFi Development Services from Developcoins?

Book a free demo here!

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