What is Compound?

Compound is a governance token used within the Compound Finance lending protocol. It enables token holders to delegate their voting rights to various addresses, including their own, other users, applications, or DeFi experts. Participation in governance is open to anyone who has COMP delegated to them, regardless of whether they own COMP themselves.

Holders with at least 1% of COMP delegated to their address can propose governance actions. These proposals may involve simple or complex modifications, such as adding new assets, adjusting collateral factors, or changing interest rate models. The protocol allows for a range of parameter adjustments that the current administrator can modify.