On Monday, June 22, our COMP-USD and COMP-BTC order books will enter transfer-only mode, accepting inbound transfers of COMP in supported regions. Orders cannot be placed or filled. Order books will be in transfer-only mode for a minimum of 12 hours. https://t.co/maPTOLdYiW
— Coinbase Pro (@CoinbasePro) June 18, 2020
The listing comes just a week after COMP distribution began amidst a frenzy of Liquidity Mining. While many anticipated the COMP would be a big deal, very few could have guessed that the sector-leading lending exchange would see $220M in new capital coming to the platform. Surging Compound to the #2 spot on DeFi Pulse, the new governance token is currently trading at over a $1B fully diluted valuation, making it the largest DeFi token by marketcap.
What’s to Know?
Just as with all Coinbase listings, COMP trading will be rolled out in a couple of phases including:
- Transfer-only – Deposits to Coinbase Pro will open.
- Post-only – Customers can post limit orders but there will be no completed orders.
- Limit-only – Limit orders can be filled, but customers are unable to submit market orders.
- Full trading – Full trading services including limit, market, and stop orders begin.
All in all, we expect these four stages to take place over the course of 48 hours, meaning that by the middle of next week, COMP will be fully liquid on the cornerstone of US crypto exchanges.
For those looking to get their hands on COMP prior to this listing, there are currently two ways to do so. The first – and definitely the most recommended – is to earn it through liquidity mining. As outlined in our launch post, COMP is allocated to markets relative to the amount of interest being accrued by a given asset. At the time of writing, this means USDT is by and large taking home the largest allocation of COMP per day. For our DeFi power users, this video by DeFi Dad gives a good look at how to use Instadapp to leverage your USDT position to maximize COMP earnings.
The second – even riskier way – of earning COMP is to purchase it directly on Uniswap using this trading pair. Seeing as the token has spiked nearly 1000% from its initial listing price of $16/token, we’d like to emphasize that very little COMP is currently in circulation and as a result, this has lead to drastic price volatility.
Coinbase Pumps Return
As anyone who’s been in the industry for a long time knows, a Coinbase listing is by and large viewed as the golden ticket for exchanges – namely due to the leading onramp for retail users just getting into crypto for the first time. The interesting angle of this particular listing is that COMP is trading just a week after it’s initial distribution, easily the quickest turnaround time for any ERC20 token in history.
Perhaps best highlighted by Coinbase’s investment in Compound in 2018, many have been quick to publicize the company’s SF headquarters are quite favorable in the rollout of the hottest new governance token on the market.
Beyond just COMP, Coinbase has taken a clear position in the support of DeFi tokens, most notably the recent re-listing of Maker‘s MKR and the consideration of 18 new assets (most of which have DeFi ties). To this, we expect Coinbase to continue acting as a leading centralized exchange for DeFi tokens, thus providing yet another indicator as to why this asset class has been outperforming the rest of the industry in 2020.
Coinbase is exploring the addition of 18 new digital assets, some are live, some are not. We will evaluate each against our Digital Asset Framework. It’s our goal to offer support for all assets that meet our standards and are compliant with local law. https://t.co/IN4g4WfYjW
— Coinbase (@coinbase) June 10, 2020
If one thing is for sure, the rollout of COMP literally could not have gone better for sector-leading lending protocol, and we’re currently entering uncharted territory when it comes to the community having complete control over how a billion-dollar protocol is governed.
Regardless of how it pans out, make sure to consider DeFi Rate when choosing where to delegate your COMP. With a strong emphasis on community sentiment, we plan on being extremely active in the governance discussions over the coming weeks – all of which you can read about in-depth right here on our website.
Until then, be sure to follow Compound on Twitter to stay up on all things COMP!
Cooper is the Editor of DeFi Rate and an active contributor to leading DeFi media outlets like The Defiant, DeFi Pulse, and Bankless. He works with early-stage teams through Fire Eyes DAO to incubate governance models and grassroots community development. He is an ambassador to Set Protocol and an author of a weekly publication called Token Tuesdays. To stay up with Cooper, follow him on Twitter.