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DeFi Protocol Compound Implements Its First Community-Driven Governance Proposals

DeFi, protocol Compound has implemented its first two community-driven governance proposals the past week. The proposals comes ahead of the launch of Compound’s Governance token (COMP), used to facilitate community-driven protocol upgrades and development.

The first proposal asked the community whether the Compound protocol should introduce support for Tether (USDT). This was inspired by a September 2019 poll that showed Tether and Maker (MKR) as the top two most-requested crypto assets for Compound.


We're excited to announce that the first governance proposal has been created – to add $USDT as a supported asset. With this milestone, the public testing of the Compound governance system has begun🔥https://t.co/nE1V0TScJP — Compound (@compoundfinance) April 27, 2020

The vote saw over 90% of the Compound community voted in favor of USDT support while being executed on May 1. The proposal introduced USDT as “a borrowable asset with its own interest rate,”. Although, Tether will not be supported as collateral.

However, to support USDT, the Compound team developed a modified cToken contract introducing support token transfer fees in underlying tokens.

On April 27, DeFi app, Dharma, submitted Compound’s second governance proposal to adjust the interest rate mode for DAI on the platform.

The proposal looked on to create a steady upward trajectory for cDAI interest rates, replacing the current system where minimal interest is earned until over 90% of cDAI is lent on the platform.


We are pleased to announce that our proposal has passed! We are very excited to improve the Compound experience for capital suppliers. https://t.co/vYraHqARXh — Dharma (@Dharma_HQ) April 30, 2020

Dharma’s proposal was passed on April 30 with over a 97% approval rate.

The implementation of the proposals has been described as the first upgrade to a major DeFi protocol exclusively conceived and developed by the platform’s community as opposed to a centralized foundation.

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