Compound Finance
A decentralized, non-custodial lending platform built on Ethereum — deposit crypto assets to generate yield or borrow against your portfolio at algorithmically determined rates.
Open DashboardWhy Compound Finance
Most lending services require you to trust a company. Compound Finance's protocol asks you to trust code — code that has been running without disruption since 2018. That distinction matters enormously.
Non-custodial by design
Your funds remain under your wallet's control at every moment. No account sign-up, no identity verification, no withdrawal restrictions imposed by any outside party.
Transparent rates
Every interest rate is computed on-chain from a publicly visible utilization formula. You can confirm the exact APR before and after any transaction, directly on Etherscan.
Community governance
COMP token holders vote on every significant protocol change. Risk settings, new collateral additions, and contract upgrades all follow the same on-chain voting process.
Multi-network reach
The Compound Finance platform operates on Ethereum mainnet, Base, Arbitrum, Optimism, Polygon, and Scroll — six networks as of the most recent deployment cycle.
How it works
The mechanics are simple. Compound III — also referred to as Comet — uses a single-base-asset structure per market. USDC is the primary borrowable asset across most deployments.
Connect your wallet
MetaMask, Coinbase Wallet, WalletConnect, Ledger, and Ronin are all supported. No email address required.
Deposit collateral or base asset
Provide ETH, WBTC, LINK, wstETH, weETH, or cbBTC as collateral. Alternatively, deposit USDC directly to earn the base supply APR.
Borrow up to your capacity
Each collateral asset carries its own collateral factor — for ETH that figure is 83% on mainnet. You may borrow USDC up to that threshold. Track your liquidation point in the dashboard.
Earn COMP rewards automatically
Both depositors and borrowers can accumulate COMP incentives on active markets. Rewards are claimable at any point without closing your position.
Repay and withdraw whenever you choose
There are no fixed loan terms. Repay partial or full amounts at your convenience, then withdraw collateral once your borrow balance is cleared.
Key features
Comet architecture (v3)
Compound III replaces the multi-asset pool of v2 with isolated base-asset markets. This lowers systemic risk and meaningfully simplifies the interest rate model.
Algorithmic interest rates
Rates adjust continuously based on utilization. No oracle is needed to set a price — supply and demand alone determine what borrowers pay. See the Ethereum DeFi documentation for background on the model.
On-chain governance
COMP holders submit and vote on Governance Improvement Proposals (GIPs). Timelock contracts enforce a 48-hour delay before any approved change goes live.
Extensions (Bulker, Migrator)
The Extensions section of the dashboard hosts third-party integrations including a collateral swap tool, a v2-to-v3 migration utility, and DeFi Saver's automation — all built permissionlessly on the Compound Finance protocol.
Multi-chain deployments
Each chain runs an independent Comet instance. Parameters, collateral lists, and reward rates vary across networks. Visit the questions page for a network-by-network breakdown.
Open-source contracts
All smart contracts are publicly available. Developers can review full source code, audit history, and deployment addresses in the Comet GitHub repository.
Position summary dashboard
A single view displays collateral value, liquidation point, borrow capacity, and remaining borrowable amount — with live oracle prices for every supported asset.
Compound Finance by the numbers
These figures reflect historical protocol activity. On-chain data is always the authoritative source — the dashboard refreshes in real time. Learn more about decentralized finance on Wikipedia.
FAQ
Quick answers to the most frequently asked questions. For more in-depth technical detail, visit the full questions page or read about the team behind Compound Finance.
What is Compound Finance?
Compound Finance is an open-source, autonomous lending protocol built on the Ethereum blockchain that allows users to supply crypto assets to earn interest or borrow against their holdings. It has been live since 2018 and has facilitated billions in loan volume.
How do I start earning interest on Compound Finance?
Connect a compatible wallet, select the asset you want to deposit — USDC, ETH, or WBTC are popular options — enter an amount, and confirm the transaction. Interest begins accruing each Ethereum block immediately after confirmation.
Is Compound Finance safe and audited?
Compound Finance's smart contracts have been reviewed by multiple independent security firms. The protocol has run continuously since 2018 and all code is open-source on GitHub. That said, smart contract risk is never zero — only deploy capital you are prepared to manage carefully.
What is the COMP token?
COMP is Compound Finance's governance token. Holders can propose and vote on protocol changes, covering interest rate model parameters, newly accepted collateral assets, and treasury decisions. One COMP equals one vote.
Can I borrow on Compound Finance if I do not have USDC?
Yes. Deposit other supported collateral assets such as ETH, WBTC, or LINK, then borrow USDC against that collateral up to your permitted borrow capacity. The exact amount depends on each asset's collateral factor — ETH carries an 83% factor on mainnet.
How does Compound Finance calculate interest rates?
Interest rates on the Compound Finance platform are set algorithmically based on the utilization ratio of each asset pool. When utilization is elevated — meaning most of the supplied USDC is currently borrowed — rates rise to attract new depositors. Lower utilization pulls rates back down automatically.
Why should I use Compound Finance instead of a centralized lender?
The protocol is non-custodial. You keep control of your assets at all times through your own wallet. There is no counterparty risk from a centralized institution becoming insolvent, and all interest rates and positions are publicly verifiable on-chain.
What collateral assets does Compound Finance accept?
Under the Compound III architecture, accepted collateral on Ethereum mainnet includes ETH, WBTC, LINK, UNI, cbBTC, wstETH, weETH, rsETH, tBTC, USDe, sdeUSD, and deUSD. Each carries its own collateral factor and liquidation threshold established by governance.
How do I participate in Compound Finance governance?
Obtain COMP tokens from a supported exchange or earn them through the protocol. Delegate your voting power to yourself or another address, then use the governance portal to review open proposals and cast votes. Submitting a proposal requires meeting a minimum COMP threshold.
What happens if my position gets liquidated on Compound Finance?
If your borrow balance surpasses your liquidation point — determined by the liquidation factor of each collateral asset — third-party liquidators may repay a portion of your debt in exchange for your collateral at a discount. Maintaining a healthy buffer between your borrow balance and maximum capacity is the primary way to avoid liquidation.
Can I use Compound Finance on networks other than Ethereum?
Compound Finance III has deployed markets on Ethereum mainnet, Polygon, Base, Arbitrum, Optimism, and Scroll. Each chain runs its own independent Comet contract with distinct parameters, supported assets, and reward rates. While Solana is a significant DeFi ecosystem, Compound Finance does not currently deploy there — the protocol remains EVM-focused.