Project & Team
Description of Project
Provide a concise narrative that clearly states each of (a)–(e) below.
- (a) Problem the project solves — The problem the project is solving.
- (b) Operational priorities — Provide a high-level description of how the project expects to support ongoing development and operations over time.
- (c) High-level project overview — How the project works at a high level.
- (d) Primary token functions — The primary functions of the token (e.g. gov participation).
- (e) Control surface reliance — If any, briefly describe the anticipated or possible evolution of the protocol's governance/control model.
(a) Problem the project solves
Compound is a decentralized money market protocol on Ethereum that lets users supply crypto assets to earn interest and borrow against collateral without negotiating with a counterparty. Interest rates are set algorithmically based on the supply and demand of each asset.
(Source: Compound Whitepaper, Compound Protocol Repo)
(b) Operational priorities
On August 17, 2026 the Foundation announced a new leadership team and framed the V4 Program as an institutional pivot, funding native real-world asset support, capital efficiency improvements, and integration tooling that lets banks, asset managers, exchanges, and fintechs embed onchain lending into their products.
(Source: Compound Foundation Announcement, CoinDesk Leadership Coverage)
(c) High-level project overview
Compound v2 used cToken markets and a Comptroller risk layer in which every listed asset was both suppliable and borrowable. Governance passed the v2 deprecation proposal in December 2025, pausing borrows and mints and setting reserve factors to 100%. Compound III (Comet) is the current production protocol. Each Comet deployment is an isolated market with a single borrowable base asset, users post collateral assets to borrow the base asset, and undercollateralized positions are liquidated through the protocol's absorb mechanism. Compound V4, in development under the Foundation, introduces a hub-and-spoke architecture that pools liquidity at a central hub while isolating risk in individual spoke markets.
(Source: Compound Protocol Repo, Compound III Docs, Messari Compound Profile, V4 Platform Roadmap)
(d) Primary token functions
COMP is the governance token of the Compound protocol. Holders delegate voting power, create proposals, and vote on all protocol changes through Governor Bravo. Addresses delegated at least 25,000 COMP can create proposals. COMP has also been distributed to protocol users as liquidity incentives through the Reservoir and CometRewards contracts. COMP carries no revenue distribution rights.
(Source: Compound v2 Governance Docs, Compound Governance Is Live, Blockworks Fee Switch Coverage)
(e) Control surface reliance
The protocol's control surface has evolved in three stages. The whitepaper-era protocol was administered by Compound Labs, Inc. In June 2020 community governance replaced the administrator, and control now runs through COMP holders, Governor Bravo, and the Timelock, which administers both v2 and all Compound III deployments. A community multisig holds the Pause Guardian and Proposal Guardian roles. Since 2025 the Compound Foundation acts as the operational coordination layer without holding unilateral protocol admin powers, and in 2026 the DAO established a 5-of-7 Treasury Management Committee multisig, with signers spanning the Foundation, security service providers, risk managers, and independent community members, to control milestone-gated program funds.
(Source: Compound Whitepaper, Compound Governance Is Live, Compound III Governance Docs, Community Multisig RFC, V4 Program Funding Proposal)
Known Project Team
For each existing entity: Labs/DevCo (e.g., Founder, CEO, CTO, COO), Foundation (e.g., President, Executive Director, CFO, COO), and DAO / onchain governance leadership (if applicable) list the: (a) full names, (b) official titles, (c) and prior experience of key team members. For any non-existent entity, explicitly mention it does not exist. External links may be included but they will not factor into the score.
Labs / DevCo
Full Name | Official Title | Prior Experience |
|---|---|---|
Robert Leshner | Co-founder. Departed Compound Labs in 2023 and founded Superstate. | Co-founded Compound Labs in 2017 and co-authored the protocol whitepaper. Economics degree from the University of Pennsylvania, CFA charterholder, former chair of the San Francisco Revenue Bond Oversight Committee, designer of the Governor Bravo contract. |
Geoffrey Hayes | Co-founder and CTO of Compound Labs. | Co-founded Compound Labs in 2017 and co-authored the protocol whitepaper. |
Jayson Hobby | CEO of Compound Labs since June 2023. | Joined Compound Labs as head of design and served as VP of Product, shaping Compound Labs products from their inception, before stepping up to CEO. |
Foundation
Full Name | Official Title | Prior Experience |
|---|---|---|
Aaron Schnarch | Executive Director, appointed by DAO vote in June 2025. | Former Chief Operating Officer of Anchorage Digital and Chief Executive Officer of Coinbase Custody. Built Coinbase's Prime Onchain Wallet and previously built capital markets and wealth management applications in institutional fintech. |
Christopher Donovan | Chief Operating Officer, appointed August 17, 2026. Previously served as the Foundation's Senior Advisor for legal, governance, and operations. | Former COO and General Counsel at NEAR Foundation. UK-qualified lawyer with experience in protocol governance, regulatory structuring, and operational execution. |
Torrey Atcitty | Technical Lead. | First employee and Principal Engineer at Compound Labs with prior experience at four start-up ventures. |
Doo Wan Nam | Partnerships Lead, DeFi. | Held senior business development roles across leading DeFi platforms. |
Michael Lewellen | Security Advisor. | Veteran protocol security advisor. Led the RFP processes for Compound's auditor and security provider transitions and negotiated the protocol's MEV and OEV arrangements. |
Ioannis Sachinoglou | vCISO for the Compound protocol, designated by the Foundation. | Manages all of Compound's Security Service Partners under the protocol's security oversight model. |
Steven Liu | Chief Product Officer, appointed August 17, 2026. | Former Maple Finance executive who scaled the platform from $500M to $5B in assets. |
Leo Eikelman | Chief Technology Officer, appointed August 17, 2026. | Engineering leadership across institutional finance and digital asset infrastructure. (Compound Foundation Announcement) |
DAO / Onchain Governance
Full Name | Official Title | Prior Experience |
|---|---|---|
@cylon | Independent delegate and community multisig process co-author with the Compound Governance Working Group. | Co-authored the Formalizing the Community Multisig proposal approved in April 2025 and its renewal through end of 2026. |
@PGov | CGWG-affiliated delegate and community multisig process co-author. | Professional governance delegation team active across Compound proposal operations and multisig process updates. |
RexShinka | DeFi Safety contributor and community multisig process co-author. | Worked on process, proof-of-humanity, and transparency documentation for the community multisig. |
The Compound Governance Working Group (CGWG) coordinates governance process and resilience updates with the Foundation and delegates. The Treasury Management Committee's 5-of-7 signer set spans the Compound Foundation, security service providers, risk managers, and independent community members, including Gauntlet and allthecolors.
(Source: Compound Whitepaper, Compound Seed Announcement, Compound Newsletter COMP Bug Fix, Compound Foundation Proposal, Foundation Transparency Report, Compound Foundation Announcement, CoinDesk Leadership Coverage, Community Multisig RFC, Community Multisig Renewal, V4 Program Funding Proposal)
DAO Structure
Provide a structured description of the DAO's governance, powers, and economic rights. If a DAO does not exist, state so. Address the lettered items below. Even if there is no DAO, there must be an answer to (d).
- (a) IP ownership & control — State what IP the DAO owns or controls (e.g., codebases/repos, trademarks/brands). Note any license if relevant.
- (b) Contract/admin powers — List on-chain or administrative authorities and limits: pause/upgrade roles (e.g., multisig pause), governance-executor authorities, and the method of authority for each (e.g., veto, majority, super-majority).
- (c) Locked-token rights (conditional) — If locking/staking for additional rights exists, explain the additional rights and what tokenholders can and cannot decide. If no locking mechanism exists, leave absent.
- (d) Value accrual & holder rights — If any, describe the current rights of tokenholders over revenue distribution and the treasury.
- (e) Dissolution authority — State who can dissolve/wind up the DAO and by what mechanism (e.g., on-chain vote threshold, board resolution of a legal wrapper).
(a) IP ownership & control
The DAO does not own the protocol codebase, trademarks, or brand assets. Compound Labs, Inc. holds the copyright to the Compound v2 codebase, which is released under a BSD-3-Clause license, and is the licensor of Compound III under the Business Source License 1.1. The project's soft assets, including the domain, website, and social media accounts, were historically held by Compound Labs and are transitioning to the Compound Foundation, a process that remained subject to unresolved legal and IP constraints as of December 2025. The Foundation operates a front end at compound.xyz as of June 2026.
(Source: Compound v2 LICENSE, Comet LICENSE, Foundation Transparency Report, V4 Monthly Update June 2026)
(b) Contract/admin powers
The protocol is governed by COMP holders through Governor Bravo and the Timelock. Addresses delegated at least 25,000 COMP can create proposals, which enter a 2-day review period followed by a voting period, and passed proposals execute through the Timelock after its delay. All sanctioned Compound III instances are controlled by the Timelock, and governance controls each Comet proxy, the Configurator implementation, the Comet factory, and the Comet implementation. The Pause Guardian role, held by the community multisig, can disable Mint, Borrow, Transfer, and Liquidate functions in v2 but cannot unpause actions or block users from exiting. The community multisig also holds Proposal Guardian responsibilities as a last defense against malicious governance votes, under a mandate approved in April 2025 and renewed through the end of 2026. Program funds under the 2026 V4 Program are controlled by a Foundation multisig for the $14M Operational Program Wallet and by the 5-of-7 Treasury Management Committee multisig for the $38M Program Reserve Wallet, with a contract-enforced timelock delay and community multisig cancellation rights during the delay window.
(Source: Compound v2 Governance Docs, Compound III Governance Docs, Community Multisig RFC, Community Multisig Renewal, V4 Program Funding Proposal)
(c) Locked-token rights (conditional)
No locking or staking mechanism grants COMP holders additional governance rights. Governance rights derive solely from holding and delegating COMP. A staked COMP product routing a share of protocol reserves to stakers was proposed in 2024 and has not launched.
(Source: Compound v2 Governance Docs, Blockworks Fee Switch Coverage)
(d) Value accrual & holder rights
COMP holders control the DAO treasury and protocol reserves through onchain governance. Governance has exercised this control by funding the Compound Foundation with approximately $9M in COMP, approving the $52M V4 Program, and establishing a treasury management envelope of approximately $90.7M overseen by the Treasury Management Committee. No mechanism currently distributes protocol revenue, fees, or reserves to COMP holders. A 2024 proposal to allocate 30% of protocol reserves to staked COMP holders through a product called stCOMP has not been implemented.
(Source: Foundation Transparency Report, V4 Program Funding Proposal, Blockworks Fee Switch Coverage)
(e) Dissolution authority
The Compound DAO operates without a legal wrapper and has no dissolution or wind-up mechanism. No party holds authority to dissolve the DAO, and dissolving it would require COMP holders to vote to transfer or disable the governance contracts themselves. The Foundation's creation proposal contemplated evaluating a Wyoming DUNA structure for the DAO as a possible future step.
(Source: Compound Foundation Proposal)
Primary Foundation
For the Primary Foundation do the following independently. If an entity does not exist, state that explicitly. Items (a)–(f) apply only if that entity exists; state explicitly that the entity doesn't exist. Definitions: The primary Foundation and DevCo can be explained as those entities which are directly involved in the issuance of the native token at launch.
- (a) Entity — Type and jurisdiction.
- (b) IP ownership & control — What IP the entity owns/controls (repos/code, trademarks/brand; license optional) and an explanation of any subsidiary entities.
- (c) Powers over DAO, treasury, protocol-controlled resources, and token administration — If any, describe the current powers over DAO governance, treasury actions, protocol-controlled resources (e.g. revenue), token administration, or reward parameters, and the method/threshold for each.
- (d) Powers over DevCo — Explain whether the foundation can exert direct or indirect influence over decision-making of the DevCo.
- (e) Contract/admin powers — Pause/upgrade/governance-executor authorities and the method/threshold for each (e.g., veto/majority/super-majority; "3/5 multisig").
- (f) Current economic arrangements and distribution policies — Describe any current governance-approved, contractual, or programmatic mechanisms, if any, by which protocol-controlled resources, treasury assets, fees, revenue, rewards, or token distributions may be directed to this entity, its equityholders, contributors, or other participants. If no such mechanism currently exists, state that explicitly. Do not discuss hypothetical future dividends, repurchases, or distributions unless formally adopted.
(a) Entity
The Compound Foundation is a U.S. non-stock Delaware nonprofit entity treated as a 501(c)(4) organization. The DAO approved its creation in June 2025 with an initial 18-month operating mandate running from July 1, 2025 through December 31, 2026, led by Aaron Schnarch as Executive Director. No foundation existed at the token's June 2020 launch. Compound Labs, Inc. was the sole entity directly involved in issuing the native token at launch.
(Source: Compound Foundation Proposal, Foundation Transparency Report, Compound Governance Is Live)
(b) IP ownership & control
The Foundation does not hold the copyright to the protocol codebase, which remains with Compound Labs, Inc. The Foundation is assuming control of the project's soft assets, including the domain, website, and social media accounts, through a transition from Compound Labs that remained constrained by unresolved legal and IP matters as of December 2025. The Foundation operates a Foundation-hosted front end at compound.xyz as of June 2026. The creation proposal permits the Foundation to form one or more wholly owned subsidiaries where required for legal, regulatory, or tax reasons, and no subsidiary has been publicly disclosed.
(Source: Compound Foundation Proposal, Foundation Transparency Report, V4 Monthly Update June 2026, Compound v2 LICENSE)
(c) Powers over DAO, treasury, protocol-controlled resources, and token administration
The Foundation holds no unilateral power over DAO governance, the treasury, or token administration. All Foundation funding was approved by DAO vote and disbursed through the governance-controlled Comptroller and treasury contracts. The Foundation retains discretion over voting Foundation-held COMP. It controls the V4 Operational Program Wallet, a Foundation-operated multisig holding the $14M first-year budget, and submits milestone completion packages to the Treasury Management Committee, which certifies or rejects each release from the $38M Program Reserve Wallet that the Foundation does not control. During the 2025 Comptroller disruption the Foundation temporarily advanced its own capital to execute governance-approved proposals, an action that did not alter governance outcomes or approvals.
(Source: Compound Foundation Proposal, V4 Program Funding Proposal, Foundation Transparency Report)
(d) Powers over DevCo
The Foundation holds no power over Compound Labs, Inc. The two are independent entities. Compound Labs publicly supported the Foundation's creation and the two entities negotiate the transfer of soft assets and potentially relevant IP from Labs to the Foundation.
(Source: Compound Foundation Proposal, Foundation Transparency Report)
(e) Contract/admin powers
The Foundation holds no protocol pause, upgrade, or governance-executor authority. Protocol admin authority rests with the Timelock under COMP holder governance, and the Pause Guardian and Proposal Guardian roles are held by the community multisig. The Foundation's onchain footprint consists of its Foundation-operated multisig over the V4 Operational Program Wallet and its participation as one signer group within the 5-of-7 Treasury Management Committee multisig, which is designed so that no single party holds unilateral control.
(Source: Compound III Governance Docs, Community Multisig RFC, V4 Program Funding Proposal)
(f) Current economic arrangements and distribution policies
Two governance-approved mechanisms direct protocol-controlled resources to the Foundation. First, the 2025 creation proposal authorized the Comptroller to transfer approximately $9M in COMP equivalent to fund Foundation operations through December 31, 2026, structured as an initial transfer of approximately $3M following approval and four quarterly tranches of approximately $1.5M each during 2026. Second, the 2026 V4 Program transfers $14M USDC to the Foundation-controlled Operational Program Wallet upfront, with up to $38M in further USDC releases from the Program Reserve Wallet gated on Treasury Management Committee milestone certification. Foundation employee compensation includes COMP subject to vesting schedules determined by the Foundation's Board of Directors, and the Foundation has converted a portion of its COMP funding into stablecoins and fiat to reduce volatility risk.
(Source: Compound Foundation Proposal, Foundation Transparency Report, V4 Program Funding Proposal)
Primary Dev Co
For the Primary DevCo do the following independently. If an entity does not exist, state that explicitly. Items (a)–(f) apply only if that entity exists; state explicitly that the entity doesn't exist. Definitions: The primary Foundation and DevCo can be explained as those entities which are directly involved in the issuance of the native token at launch.
- (a) Entity — Type and jurisdiction.
- (b) IP ownership & control — What IP the entity owns/controls (repos/code, trademarks/brand; license optional) and an explanation of any subsidiary entities.
- (c) Powers over DAO, treasury, protocol-controlled resources, and token administration — If any, describe the current powers over DAO governance, treasury actions, protocol-controlled resources (e.g. revenue), token administration, or reward parameters, and the method/threshold for each.
- (d) Powers over Foundation — Explain whether the DevCo can exert direct or indirect influence over decision-making of the Foundation.
- (e) Contract/admin powers — Pause/upgrade/governance-executor authorities and the method/threshold for each (e.g., veto/majority/super-majority; "3/5 multisig").
- (f) Current economic arrangements and distribution policies — Describe any current governance-approved, contractual, or programmatic mechanisms, if any, by which protocol-controlled resources, treasury assets, fees, revenue, rewards, or token distributions may be directed to this entity, its equityholders, contributors, or other participants. If no such mechanism currently exists, state that explicitly. Do not discuss hypothetical future dividends, repurchases, or distributions unless formally adopted.
(a) Entity
Compound Labs, Inc. is a U.S. for-profit corporation incorporated on August 28, 2017 and headquartered in San Francisco, California. It developed the Compound protocol and issued the COMP token at launch. Compound Prime, LLC is a subsidiary of Compound Labs, Inc.
(Source: CB Insights Compound Profile, Compound Treasury S&P Credit Rating, Blockworks S&P Rating Coverage)
(b) IP ownership & control
Compound Labs, Inc. holds the copyright to the Compound v2 codebase, released under a BSD-3-Clause license, and is the licensor of Compound III (Comet) under the Business Source License 1.1. Compound Labs historically held the project's soft assets, including the domain, website, and social media accounts, and is transferring these to the Compound Foundation through a process that remained subject to unresolved legal and IP constraints as of December 2025. Compound Prime, LLC operated the Compound Treasury institutional product as a Labs subsidiary.
(Source: Compound v2 LICENSE, Comet LICENSE, Foundation Transparency Report, Blockworks S&P Rating Coverage)
(c) Powers over DAO, treasury, protocol-controlled resources, and token administration
Compound Labs holds no powers over DAO governance, the treasury, protocol-controlled resources, token administration, or reward parameters. Community governance replaced Compound Labs as the protocol administrator in June 2020, and all protocol changes since then originate from COMP holders through Governor Bravo and the Timelock. Compound Labs participates in governance only through any COMP voting power it or its principals hold and delegate, on the same terms as any other tokenholder.
(Source: Compound Governance Is Live, Compound v2 Governance Docs)
(d) Powers over Foundation
Compound Labs holds no power over the Compound Foundation. The Foundation is an independent entity whose Executive Director was appointed by DAO vote and whose board is appointed by the Executive Director and ratified by the DAO.
(Source: Compound Foundation Proposal)
(e) Contract/admin powers
Compound Labs holds no pause, upgrade, or governance-executor authorities over the protocol. The Timelock administers all protocol contracts under COMP holder governance, and the Pause Guardian and Proposal Guardian roles are held by the community multisig rather than by Compound Labs.
(Source: Compound v2 Governance Docs, Compound III Governance Docs, Community Multisig RFC)
(f) Current economic arrangements and distribution policies
No current governance-approved, contractual, or programmatic mechanism directs protocol-controlled resources, treasury assets, fees, revenue, rewards, or token distributions to Compound Labs, its equityholders, or its contributors. The launch-era allocations to this entity's stakeholders were fixed at token genesis, comprising 2,396,307 COMP distributed to shareholders of Compound Labs, Inc. and 2,226,037 COMP allocated to founders and team subject to 4-year vesting that has fully elapsed.
(Source: Compound Governance Is Live)
Compound Labs raised its capital through equity financing rather than token sales. See Section 10.
Token Supply & Allocations
Initial Allocation
Disclose launch and initial supply details in a single initial allocation schedule covering the token's launch. Include: (a) Launch supply totals — the total number of tokens issued at launch, the total number of tokens locked at launch or the total number of tokens unlocked at launch; (b) Recipient categories & use of funds — the recipient categories with brief explanations as to how the category will use the tokens so an auditor can distinguish each bucket; (c) Initial price per token (if applicable) — the initial price per token at TGE. If the token launched via a liquidity bootstrapping mechanism, auction, or other price-discovery process rather than a fixed offering price, describe that mechanism and the final market set price instead. If no fixed price was set, state so; (d) Ticker / market symbol — the ticker/market symbol; (e) Total supply & supply regime — the total supply and whether the supply is fixed (if not explain inflation rate or deflation rate); (f) Initial vesting / release schedules — the initial vesting/release schedules (identify which categories/recipients are subject to vesting and the high-level timing logic).
Launch Supply Totals | Recipient Categories & Use of Funds | Initial Price per Token | Ticker / Market Symbol | Total Supply & Supply Regime | Initial Vesting / Release Schedules |
|---|---|---|---|---|---|
10,000,000 COMP were minted at genesis. At the June 2020 governance launch, 2,396,307 COMP had been distributed to shareholders and the remaining 7,603,693 COMP were locked under vesting, held in the Reservoir contract for programmatic release, or reserved for future distribution. | Shareholders of Compound Labs, Inc. received 2,396,307 COMP (23.96%) as the launch-era stakeholder allocation. Founders and team received 2,226,037 COMP (22.26%) subject to 4-year vesting. Future team members were allocated 372,707 COMP (3.73%) for hiring. Users of the protocol were allocated 4,229,949 COMP (42.30%), placed into the Reservoir contract for ongoing block-by-block distribution to suppliers and borrowers. Community governance uses received 775,000 COMP (7.75%) to advance governance through other distribution channels. | COMP launched without a token sale, auction, or other price-discovery offering, and no fixed offering price was set at TGE. User distribution through the Reservoir began in June 2020 and secondary market trading established the price. | COMP | Total supply is fixed at 10,000,000 COMP with no inflation or minting mechanism. Supply movement consists solely of governance-controlled distribution of the fixed genesis allocation. Circulating supply is approximately 9.67 million COMP as of August 2026 and must be re-pulled at publication. | The founders and team allocation of 2,226,037 COMP vested over 4 years. The user allocation of 4,229,949 COMP was placed in the Reservoir contract, which transferred 0.50 COMP per Ethereum block (about 2,880 per day) into the protocol, split 50/50 between suppliers and borrowers in each market. Governance modified the distribution in Proposals 10, 21, 33, and 62, moving to a fixed 2,312 COMP per day allocation by April 2021 and later to governance-set supply and borrow speeds per market. (Compound Governance Is Live, Expanding Compound Governance, Compound Newsletter COMP Bug Fix) |
(Source: Compound Governance Is Live, Expanding Compound Governance, Compound v2 Governance Docs)
Airdrop Process
Address each of the following sub-items based on the project's airdrop status. If a sub-item does not apply to the project's situation, state that explicitly.
- (a) Planned but not yet executed airdrop — If the project has planned but not yet airdropped, commit to publishing a recipient wallet list in a public channel and provide it to Blockworks quarterly until the initial TGE airdrop is fully completed. Additionally, generally state the possible target user segments (e.g., "stakers of X," "Aave users") and the allocation method (e.g., proportional to ve-balance or net position).
- (b) Executed airdrop — If the project has already airdropped, point to a per-address source such as CSV/TSV/JSON files, a Dune table, a full Merkle dump, GitHub repo files embedding per-address allocations, or RPC endpoints that expose claim/amount data; explorer links alone do not count. Additionally, clearly state covered user segments (e.g., "stakers of X," "Aave users") and the allocation method (e.g., proportional to ve-balance or net position).
- (c) No airdrop planned or conducted — If the project does not plan to conduct an airdrop for TGE and has never conducted one, state so plainly (e.g., "We have never conducted an airdrop to date and do not plan to execute one").
(a) Planned but not yet executed airdrop
Not applicable. The project has no planned airdrop.
(b) Executed airdrop
Not applicable. The project has never executed a TGE airdrop.
(c) No airdrop planned or conducted
Compound has never conducted a TGE airdrop and does not plan to conduct one. Token distribution to users occurs through ongoing governance-controlled mechanisms, principally the Reservoir contract's block-by-block distribution to protocol suppliers and borrowers and the community-governance allocation routed through governance-approved programs.
(Source: Compound Governance Is Live, Expanding Compound Governance)
Transactions & Market Structures
Market Maker Agreements & Deals
Projects must disclose all material terms of market-making arrangements that affect token liquidity. If the project has no agreements or deals with market makers, state that explicitly; doing so earns full credit. For each market maker, include in a table: (a) Market maker's name — the market maker's name; (b) Token allocation or loaned amount — the token allocation or loaned amount as a percentage of total supply; (c) Duration/term of agreement — the duration/term of the agreement; and, where applicable, (d) Name of agreement structure — label the financial vehicle being used in the agreement (i.e. loan, option/call, retainer model) without describing trading strategy or expected outcomes. If the project has no agreements or deals with market makers, state that explicitly; doing so earns full credit. If no native tokens were loaned or allocated to market makers, state that explicitly; cash/fiat retainers or fees are not required for this item.
The project has not publicly disclosed any market maker agreements, token loans to market makers, or token allocations to market makers. COMP launched without a token sale and the launch allocation schedule contains no market maker category.
(Source: Compound Governance Is Live)
CEX / DEX Agreements & Deals
Projects must disclose all material terms of centralized or decentralized exchange listings that affect token liquidity. For each listing, include in a table: (a) Exchange name / DEX pool — the exchange name (and, for DEX, the specific pool/pair); (b) Token allocation for listing — the token allocation supplied or committed for listing as a percentage of total supply; (c) Term Duration — the duration/term of any listing lockups, liquidity, or incentive programs; and, where applicable, (d) Native-token listing fees — whether any listing fees were paid in native tokens, with amounts (tokens or % of supply), recipients, and any vesting or lock terms tied to the partnership. If the project has no agreements or deals with CEX or DEX, state that explicitly; doing so earns full credit; cash/fiat fee amounts are not required for this item.
The project has not publicly disclosed any centralized or decentralized exchange listing agreements, token allocations committed for listings, listing lockups, or listing fees paid in COMP.
Financial Disclosures & Risks
Prior Token Sales & Fundraising
Disclose all prior token sales by the Project — including fundraising rounds, any material OTC sales to investors, and any discounted market-maker sales. For each sale, provide: (a) Series Name; (b) Early-Stage Investment Instrument used (i.e. SAFT, STAMP, SAFE, SAFE+Token Warrant, etc.); (c) Date of sale (at least month & year); (d) Number of tokens sold (or % of total supply); (e) Vesting schedule. If no prior sales occurred, state that explicitly (e.g., "No prior fundraising, OTC, or discounted MM sales have occurred.").
Series Name | Investment Vehicle | Date Of Sale | Number of tokens sold | Vesting Schedule |
|---|---|---|---|---|
Seed | Equity financing in Compound Labs, Inc. | May 2018 | No tokens were sold. The round raised $8.2M led by Bain Capital Ventures, Andreessen Horowitz, and Polychain Capital, with participation from Transmedia Capital, Compound Ventures, Abstract Ventures, Danhua Capital, and Coinbase. | Not applicable |
Series A | Equity financing in Compound Labs, Inc. (The Block Series A Coverage) | November 2019 | No tokens were sold. The round raised $25M led by Andreessen Horowitz, with participation from Bain Capital Ventures, Polychain Capital, and Paradigm. (CoinDesk Series A Coverage) | Not applicable |
Compound has never conducted a token sale, material OTC token sale to investors, or discounted market maker sale. The project was funded entirely through the two equity rounds above, totaling $33.2M. Equity shareholders of Compound Labs, Inc. subsequently received the 2,396,307 COMP launch allocation described in Section 6.
(Source: Compound Seed Announcement, Compound Governance Is Live)
Previous Exploits Affecting the Native Token
If any, list prior exploits or incidents that directly affected the token, token supply, tokenholder balances, token contract, minting controls, burn mechanics, or custody of token supply. This question is not asking about general protocol, application, or smart contract exploits unless the incident directly affected the native token itself. If no prior incidents, state this explicitly (e.g., "No exploits affecting tokenholders or protocol funds as of YYYY-MM-DD").
- (a) Date & component affected — Date (YYYY-MM or YYYY-MM-DD), chain(s)/component affected.
- (b) Exploit vector summary — Plain-language summary of the exploit vector (what the hack was).
- (c) Quantified impact — Quantified impact (assets/tokens affected or a clear "no loss of funds" statement).
- (d) Remediation/response taken — Remediation/response taken (patches, upgrades, governance actions, compensation).
- (e) Current status — Current status (resolved, in litigation, under investigation, refunded, etc.).
- (f) References (optional) — Link(s) to post-mortem/advisory/PR.
(a) Date & component affected
2023-12, Base WETH Comet market.Disclosed Griefing Bug Analysis
(b) Exploit vector summary
In September 2021, Proposal 62 introduced a bug into the upgraded Comptroller contract that allowed users in certain markets to accrue and claim far more COMP than intended, and a scheduled Reservoir transfer during the multi-day governance remediation window enlarged the at-risk pool. In December 2023, a rounding issue in the Base WETH Comet's isBorrowCollateralized function let an attacker withdraw or transfer extremely small amounts of the base asset without collateral, creating a tiny negative principal balance. In July 2024, a group of whale wallets known as the Golden Boys accumulated and delegated COMP to pass Proposal 289, which allocated approximately $24M of treasury COMP to an external yield vehicle called goldCOMP over broad delegate objection.
(Source: The Block 2021 Bug Coverage, Compound Newsletter COMP Bug Fix, Comet Vulnerability Disclosure, CoinDesk Governance Attack Coverage)
(c) Quantified impact
The 2021 distribution bug placed roughly $150M of COMP at risk at then-current prices. Approximately 163,000 incorrectly claimed COMP were returned to the community Timelock, approximately 130,000 COMP remained unclaimed in the Comptroller, and approximately 200,000 misallocated COMP remained outstanding at the time of the patch. No supplied or borrowed user funds were affected. The 2023 Base WETH issue allowed extraction of less than 0.00000001 WETH and was economically infeasible because gas costs far exceeded the extractable amount, but it broke a core protocol invariant. The 2024 governance attack passed an allocation of approximately $24M in treasury COMP.
(Source: Compound Newsletter COMP Bug Fix, The Block 2021 Bug Coverage, Comet Vulnerability Disclosure, Blockworks Governance Attack Coverage)
(d) Remediation/response taken
For the 2021 bug, Proposal 63 disabled further COMP distribution, Proposal 64 deployed the patch on October 9, 2021 with a one-off fixBadAccruals function, and users who claimed erroneous COMP were asked to return tokens to the Timelock with a 10% white-hat allowance. For the 2023 Base WETH issue, the fix was deployed through Proposal 195 before public disclosure, and the disclosure accompanied a formalization of the protocol's bug bounty. For the 2024 governance attack, the proposer agreed to negate the goldCOMP allocation and return the COMP under a negotiated settlement, in exchange for a commitment to develop a staked COMP revenue-sharing proposal, and the DAO subsequently implemented the community multisig Proposal Guardian as a structural defense against malicious governance votes.
(Source: BeInCrypto Proposal 64 Coverage, Compound Newsletter COMP Bug Fix, Comet Vulnerability Disclosure, Crypto Briefing Settlement Coverage, Compound Governance Proposal Guardian)
(e) Current status
All three incidents are resolved. In addition, an adversarial governance action in the second half of 2025 disrupted normal Comptroller operations, and the Foundation temporarily advanced capital to execute governance-approved proposals during that episode without altering governance outcomes. That matter is also resolved operationally.
(Source: Foundation Transparency Report)
(f) References (optional)
(Source: Compound Newsletter COMP Bug Fix, Comet Vulnerability Disclosure, Blockworks Governance Attack Coverage, Foundation Transparency Report)
Material Risk Factors (Regulation, Technology, Token Economics)
Describe material risk factors across the three categories below. Each category includes prompts to address at a minimum.
- (a) Regulatory, Legal & Tax Risks — Describe how evolving laws and regulations could affect the project by answering, at a minimum, questions like:
- Impact of Regulatory Change on TGE and Listings: (If applicable) How could evolving or conflicting laws and regulations affect your ability to complete the TGE, deliver tokens to purchasers, and list or maintain the token on trading venues in key jurisdictions?
- Entity-Level Regulatory Impact: (If applicable) How could regulatory or legal changes impact your core entities (Foundation, DevCo, DAO, affiliated service providers), including enforcement actions, licensing requirements, or forced changes to structure or operations?
- Tokenholder Tax Treatment: (If applicable) What uncertainties exist around how tokenholders may be taxed, and make clear that tokenholders are responsible for understanding their own tax obligations?
- Jurisdictional & User Access Restrictions: (If applicable) If the project restricts access for certain jurisdictions or user types (e.g., U.S. persons, sanctioned countries, retail vs. professional), what are those restrictions and what risks do they create for users and for the project?
- (b) Protocol, Technology & Security Risks — Describe risks to network and contract reliability, correctness, and safety by answering, at a minimum, questions like:
- Bugs and Design Flaws: (If applicable) What bugs, design flaws, or implementation errors could exist in your core protocol code, smart contracts, and any bridges, rollups, or oracles that you depend on, and how could these lead to loss of funds or disruption of the protocol?
- Security Measures & Their Limitations: (If applicable) What security measures have you taken (audits, formal verification, bug bounties), and what types of failures might these measures still fail to detect or prevent?
- (c) Token Economics, Unlocks & Incentive Risks — Describe how the token's economic design and supply schedule could affect holders by answering, at a minimum, questions like:
- Critical Economic Assumptions: (If applicable) Which economic assumptions (e.g., staking yields, fee revenue, liquidity incentives, MEV capture, demand for blockspace) are critical for protocol security, utility, and governance, and what happens if those assumptions fail?
- Governance Control over Monetary Policy & Rewards: (If applicable) To what extent can governance change monetary policy, fee parameters, or reward allocations (e.g., inflation rate, treasury flows, incentive programs), and how could such changes adversely affect tokenholders?
(a) Regulatory, Legal & Tax Risks
COMP is live and trading, so TGE completion risk does not apply, but regulatory change affects the project's entities and listings. S&P Global Ratings cited uncertain stablecoin regulation and stablecoin-to-fiat convertibility risks in assigning a B- rating to Compound Prime, LLC, the Compound Labs subsidiary that operated Compound Treasury, demonstrating that regulatory conditions directly affect affiliated entities. The DAO created the Compound Foundation as a Delaware 501(c)(4) partly in response to the evolving U.S. regulatory landscape, and the Foundation's first operating period was materially constrained by unresolved legal and IP matters and litigation-sensitive workstreams, including matters relating to Elixir. The DAO itself operates without a legal wrapper, which leaves participant liability treatment unsettled. The project publishes no jurisdiction-restriction framework for COMP, and tokenholders are responsible for understanding and meeting their own tax obligations, which remain uncertain and vary by jurisdiction.
(Source: Compound Treasury S&P Credit Rating, Blockworks S&P Rating Coverage, Compound Foundation Proposal, Foundation Transparency Report)
(b) Protocol, Technology & Security Risks
Compound depends on smart contract logic, price feeds, privileged governance and guardian roles, and upgrade pathways that can fail or be exploited. The protocol is fully upgradeable through governance, so a captured or defective governance action can change protocol logic and affect funds. The incident history demonstrates these risks concretely. The 2021 Proposal 62 bug misallocated roughly $150M in COMP through a governance-deployed contract upgrade, the 2023 Base WETH rounding issue broke a core collateralization invariant, and the 2024 governance attack passed a $24M treasury allocation against delegate objection. Security measures include multiple third-party audits, OpenZeppelin's comprehensive Compound III audit, Certora formal verification, public code, a bug bounty, a designated vCISO managing the ChainSecurity, Certora, and ZeroShadow security service provider team, and SOC-style monitoring controls introduced in 2025. These measures did not prevent every defect, and each discovered issue still required patching, governance action, and continued monitoring, so audits and verification reduce but do not eliminate the risk of loss.
(Source: OpenZeppelin Compound III Audit, DeFiScan Compound V3 Analysis, Compound Newsletter COMP Bug Fix, Comet Vulnerability Disclosure, Foundation Transparency Report)
(c) Token Economics, Unlocks & Incentive Risks
COMP's utility is concentrated in governance, so token value depends on demand for governance participation and on the protocol's competitive position rather than on direct cash flows, since no mechanism distributes protocol revenue to tokenholders. Compound's total value locked stands at $1.2B as of August 2026, down from a $12B peak in September 2021, and Aave holds more than eleven times Compound's TVL, so the protocol's competitive position has weakened materially since its peak. Supply is fixed at 10 million with approximately 97% circulating, so dilution risk is minimal but governance controls remain the dominant economic lever. Governance can and does change reward allocations, treasury flows, and monetary parameters, having deployed more than $400M in incentives since 2021, funded the Foundation with approximately $9M in COMP, approved the $52M V4 Program, and established an approximately $90.7M treasury management envelope. Adverse governance decisions, incentive programs that fail to produce durable growth, or treasury deployments that underperform directly affect tokenholders. Denominating budgets in COMP exposes funded programs to token price risk, as shown when the COMP price decline from a 30-day TWAP of approximately $44 at Foundation approval to approximately $25 by December 2025 materially reduced the Foundation's effective operating budget. Concentrated voting power poses a demonstrated risk, as the 2024 goldCOMP episode showed that a whale bloc can pass treasury allocations over delegate objection, and structural defenses now rest on the community multisig Proposal Guardian and delegate coordination.
(Source: V4 Program Funding Proposal, Foundation Transparency Report, Blockworks Governance Attack Coverage, Tokenomist, Compound Governance Proposal Guardian, CoinDesk Leadership Coverage)
This Token Transparency Filing is provided for general informational purposes only and does not verify or warrant the accuracy of individual answers.