Compound is a decentralized algorithmic money market protocol running on the Ethereum blockchain that uses loan pools to facilitate lending in a variety of cryptocurrencies. Borrowers can take out secured loans, while lenders who make funds available to loan pools can earn income on their deposits via specially issued native tokens.
Put simply, Compound allows users to deposit cryptocurrency in loan pools for access by borrowers. Creditors then earn interest on the assets they deposit.
Once a deposit
is made, Compound assigns a new cryptocurrency called cToken (which represents the deposit) to the lender. Examples of cTokens include cETH, cBAT and cDAI.
Each cToken can be transferred or exchanged without restrictions, but is only redeemable for the cryptocurrency initially locked in the protocol. The entire process is automatic and handled by the Compound code, which means lenders can withdraw deposits at any time.
To incentivize this activity, Compound uses another cryptocurrency native to its service, called COMP. Every time a user interacts with a Compound marketplace (borrowing, withdrawing or refunding the asset), they are rewarded with additional COMP tokens.
Although complex, the model has so far proven adept at attracting users and encouraging other DeFi cryptocurrencies to adopt its model.
Loan tokens on Compound are a great way to get your crypto holdings to capture compound interest over time. Compound currently hosts 14 pools of different cryptocurrencies such as Ethereum, Uniswap and even stablecoins such as DAI. Each of these pools has different loan and loan interest rates that are the same for everyone, regardless of the number of tokens they provide or borrow. You can hold your position within a pool for as long as you want and freely withdraw your funds as you please.
Compound price forecast for the next 90 days
The entire cryptocurrency world is on the verge of complete collapse. Bitcoin fell 75% from its all-time high amid broader market declines caused by furious inflation and the US Fed’s rate hikes.
When you add the most recent collapses of huge industry players (FTX, Celsius, Moon etc.) into the equation, the horizon is murky and there will be more blood on the streets of the crypto city.
Investors are selling risky assets and moving to more stable markets. Crypto is still perceived as a very risky game and therefore sell off.
Our algo still sees some green in 2023, especially in the second half of the year. This is reflected in our forecast for 2023.
Right now, Bitcoin needs to find a bottom before we can move in the opposite direction and reverse the trend.
Once Bitcoin settles into the new price range, altcoins will start doing the same – we’ve seen this scenario dozens of times in distant and more recent history.
Our price forecasting model is bearish for the next 90 days with a hint of a bull market straddling quarters from Q1 to Q2. We expect whales and other larger players in the market to finish filling their bags around that time, which will cause a typical and sudden crypto spike.
The fundamentals we evaluate are teams, tokenomics, use case, community, marketing efforts, liquidity and availability of exchange, hype and speculative potential, and some other proprietary factors developed in our crypto lab.
COMP Price Prediction 2023
Our forecast model calls for a temporary shift to a bear market in early 2023 before moving to another lead in Q3 and Q4 of 2023.
Compound Price Prediction 2025 – 2030 – 2040
Our forecasting model predicts that COMP will reach new highs in 2025:
The COMP price in 2030 and 2040 is expected to be a couple of orders of magnitude higher than our 2025 forecast.