Compound Finance is experiencing a surge in on-chain and network activity despite being embroiled in controversy. Recent data shows that whale transactions, on-chain volume, and token circulation are at or near year-high levels.
The Compound community’s trust in the project has been shaken by several questionably passed initiatives following sparse voting. The situation has sparked widespread discussion, with informative posts like those from @DefiIgnas contributing to the heightened on-chain activity, as reported by Santimentfeed.
🤯 Following a sparse amount of voting that resulted in several questionably passed initiatives, the Compound community's trust in the project has been waning. With a massive increase in discussion due to informative posts like this one from @DefiIgnas, our metrics indicate that… https://t.co/IlL5ZvUMpV pic.twitter.com/kEsYzNba4I
— Santiment (@santimentfeed) July 29, 2024
Metrics such as whale transactions and circulation continue to appear polarizing, leading to volatile prices while the story remains at the forefront of the COMP and altcoin communities.
DefiIgnas reports that Compound Finance suffered a setback due to a lack of care. An initial proposal to grant 92k $COMP was submitted without prior discussion, but Compound’s security advisor, @LewellenMichael, flagged it. Despite the warning, the DAO forum received only six comments. Notably, @MonetSupply and Wintermute were among the few who expressed concern.
Compound Finance got DAO REKT because they just don't seem to care.
Here’s how absurd the process was:
An initial proposal to grant 92k $COMP was submitted without prior discussion. Thankfully, Compound's security advisor @LewellenMichael spotted it.
Despite glaring red flags,… pic.twitter.com/LKXphGQVZ3
— Ignas | DeFi (@DefiIgnas) July 29, 2024
The proposer, Humpy, acknowledged the criticism and canceled the first proposal. However, the second proposal also received minimal engagement, with just four comments, and ultimately failed. The situation escalated when Humpy submitted a third proposal, increasing the requested $COMP amount from 92k to 499k. This proposal passed with only 57 addresses casting votes.
Typically, around 20 addresses participate in DAO votes, and proposal discussions in the forum attract little engagement. For example, a contentious plan to launch a USDT market on Compound III quietly passed in July.
Most proposals in Compound DAO originate from Gauntlet, which effectively runs the DAO as it receives payment for its services. This arrangement has led to minimal interest from others, including the Compound team, which has ceased tweeting.
As Compound navigates this period of heightened activity and internal strife, the project’s future remains uncertain amidst these challenges.
Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any services.
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