Compound looks to emulate Uniswap with new foundation initiative
Compound Labs, the team behind the DeFi protocol Compound Finance, is considering launching a dedicated foundation to streamline operations and support the protocols long-term development.
Compound is one of the most popular DeFi lending protocols on Ethereum. According to DefiLlama data, the platform currently has $2.5 billion in total value locked (TVL).
Following the announcement, COMP, Compound Finances native token, fell roughly 6% to a local low of $42 before recovering slightly to trade at approximately $45 as of press time, based on CryptoSlate data.
Why Compound Foundation?
In an April 1 social media post, the firm noted that establishing a foundation has become standard practice across major DeFi ecosystems. A similar structure for Compound would help bring more stability, legal clarity, and community alignment to the protocols operations.
The team acknowledged that the protocols early operational model was basic, reflecting DeFis experimental nature during its early days. However, as the platform matured, the lack of a central structure made managing critical processes more difficult.
Despite outsourcing areas like risk assessment to Gauntlet and security auditing to OpenZeppelin, the absence of a formal foundation has created unnecessary complexity.
The team stated:
With the upcoming development of Compound v4 and growing engagement in the community forums, along with the progressive decentralization of the Compound ecosystem and the pullback of involvement from Compound Labs, weve seen the growing need for more consistent structure. In response, we believe its time to explore the creation of a Compound Foundation.
The proposed Compound Foundation would be independent of Compound Labs and any existing entities if created. It would offer a reliable layer of coordination and leadership for the protocols stakeholders.
Compound Labs said the foundations goal would be to provide a model similar to what the Uniswap Foundation offers its community, facilitating governance, development, and communication among contributors.
Before moving ahead, Compound Labs plans to open the conversation to the community on its forums to gather feedback.
The post Compound looks to emulate Uniswap with new foundation initiative appeared first on CryptoSlate.
Read more: https://cryptoslate.com/compound-looks-to-emulate-uniswap-with-new-foundation-initiative/
Text source: CryptoSlate
