Decentralized Finance Investment and Yield Farming Explained

COMP is really the token of native governance backed by Compound Finance, the pioneering lending protocol. COMP is often used to vote on protocol enhancements, namely protocol fees, collateral support, and shifts in interest rates. COMP has launched the yield farming trend as a new method to lock assets into the decentralized finance (DeFi) platform and the first token to briefly surpass MakerDAO being the market leader. In technical and other processes, COMP has turned out to be a little bit of a surprise to the DeFi community. Its emergence has sparked a surge of new thought. Other projects are functioning on similar lines. In reality, informed sources suggest that CoinDesk will launch brand-new ventures with these unique modules. People will soon witness more unimaginative yield farming techniques in the future. For instance, variants of profit-sharing may reward certain types of conduct.

For instance, one can imagine that COMP holders decide that the protocol required more individuals to invest money and keep it a bit longer. The community can chalk out a proposal that cuts off some of each token's yields and pays off the part only to tokens older than six months in all.