Compound To Allow Institutions Use Cryptos as Collateral for Borrowing USD or USDC

    After a series of outstanding developments, the Compound lending platform (COMP) continues to launch a new product for institutional investors.

    Compound Treasury, a cash management solution for institutions powered by Compound, announced on September 14 that the institutions under the project’s accreditation are now able to borrow USD or USDC at a fixed interest rate starting at 6% APR, using Bitcoin (BTC), Ethereum (ETH) and ERC-20 as collaterals. Companies in the crypto, fintech, and banking field will be supported by Compound in the new product. 

    Reid Cuming, Vice President of Compound Treasury said:

    “Compound Treasury can now address demand for liquidity with simple, reliable borrowing solution, while continuing to provide the same trusted service we’ve delivered to clients earning interest over the past year.”

    In addition, Compound added that borrowing for clients will remain flexible, with “an open-ended term” and “no repayment schedule,” so long as participating clients remain overcollateralized. The collateral provided by the borrowing institutions is still under the control of Compound Treasury, thereby increasing the transparency and safety of the funds.

    Liquidity for the product will be provided by Compound Treasury customers and from Compound itself, which has over $3 billion in assets and over $285 billion in total trading volume.

    The announcement came after Compound was rated a B-credit from S&P Global in May 2022, making it the first company in the field to receive a rating from a well-known independent financial institution. Not only that, the platform has just launched Compound III – a multi-chain lending product, which promises to open up more choices for DeFi users.

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