Compound Negotiates End to Governance Crisis

Crypto lending protocol Compound Finance has managed to stave off death via centralized takeover through a last-ditch COMP staking proposal.

What's the scoop?

• This weekend, COMP whale Humpy pushed through a contentious governance proposal that would have allocated 1/4th of the Compound Treasury—499k COMP worth ~$25 million—to their Golden Boys goldCOMP strategy vault.
• In exchange for Compound’s commitment to create a staked COMP product that distributes 30% of revenues generated from lending and liquidity providing activities to COMP stakers, Humpy has agreed to cancel their prior proposal.
• Notably, implementation of the earlier controversial proposal would have granted the whale unprecedented control over Compound’s governance process, enabling them to wield near unilateral discretion in approving whatever proposals they please.

Bankless take:

COMP holders should rejoice that Humpy’s proposal resulted in enhanced token utility instead the creation of an all-powerful giga-delegate, yet although the presence of staking marginally improves COMP’s fundamentals, it nonetheless remains highly concerning that this proposal was passed in the first place.