Compound is one such protocol, primarily concerned with the financial services of borrowing and lending your crypto Residing on the ethereum network, this protocol allows users to lend and borrow assets without the need for a traditional financial intermediary. This article covers the foundation of compound, how and why it works, and some of the risk factors with compound crypto.
| Drako Aponte X2
Compound finance is a permissionless defi lending protocol that allows lenders to earn interest from their crypto holdings
The deposited assets are held in smart contracts known as liquidity pools, and interest rates are adjusted algorithmically based on supply and demand.
What is compound finance in crypto Compound finance is a decentralized lending and borrowing protocol that supports several chains, including the ethereum blockchain, base, arbitrum, and others Lenders can deposit select cryptocurrencies into a lending liquidity pool to earn a proportional yield on funds borrowed from the pool. Learn all about the platform, how it works, and the comp token in this guide.
