Compound Finance recently reached a settlement with the crypto whale known as Humpy and his Golden Boys group regarding the allocation of 499,000 COMP tokens valued at around $24 million to a yield-bearing protocol. Humpy announced the cancellation of Proposal 289, which sparked the controversy, and highlighted that the COMP token will now be transformed into a yield-bearing asset. Following this news, the value of COMP surged by approximately 7% to $51 amidst a broader market downturn.
Compound Finance, renowned as one of the biggest DeFi lending protocols in the industry with over $3 billion in assets locked, is set to introduce a new staking product. This product will distribute 30% of existing and new market reserves annually to staked COMP holders based on their stake size. The decentralized autonomous organization (DAO) of Compound will oversee this staking product, with audits conducted by a designated security partner and continuous monitoring by the DAO’s Market Risk Manager.
The community, including Humpy and DeFi risk manager Gauntlet, has largely welcomed the settlement between Compound Finance and Humpy. Humpy expressed his full support for the move, while Gauntlet emphasized their readiness to analyze proposed mechanisms or designs for the staking product. StableLab’s Doo highlighted the importance of enhancing Compound’s governance security to prevent similar incidents in the future, suggesting various governance changes to strengthen security measures.
In conclusion, Compound Finance’s resolution with Humpy and his group over the COMP token allocation issue has led to the development of a new staking product that aims to benefit COMP holders. The agreement has been positively received by the community, with support from key stakeholders such as Humpy and Gauntlet. Moving forward, it is essential for Compound to prioritize governance security to maintain trust and prevent potential governance vulnerabilities in the future.
