Having led the way in decentralized finance lending, Compound now aims to draw institutional interest as retail engagement wanes.
By Olivier Acuna|Edited by Sheldon Reback41 min ago3 min readMake preferred on ShareShare this articleCopy linkX (Twitter)LinkedInFacebookEmailMake preferred on Compound Finance has committed $52 million and made leadership changes as part of its strategy to appeal to institutional DeFi. (Miguel Parera/Unsplash)SummaryShow- Compound Finance has completely restructured its leadership and set aside a record budget of $52 million to stimulate growth after its total value locked dropped from $12 billion in 2021 to $1.2 billion.
- The protocol is shifting its focus toward institutional clients by creating offerings related to real-world assets, enhancing partner integrations, and establishing credit infrastructure that meets traditional financial standards.
- Industry experts believe the new leadership and substantial budget reflect a wider trend in decentralized finance (DeFi) towards catering to financial institutions amid a decline in overall assets due to market instability and security breaches.
Compound Finance, a leading protocol in decentralized finance lending, has undergone a significant leadership overhaul and allocated a budget of $52 million to attract new investments, following a decline in its total locked value from $12 billion in September 2021 to a mere $1.2 billion.
In its new approach, the company aims to engage institutional users by focusing on real-world asset offerings, partner integrations, and building credit infrastructure suitable for traditional finance.
Since its establishment in 2018, Compound has been a pioneer in decentralized lending, allowing users to earn yields on crypto deposits without intermediaries. The protocol has facilitated approximately $480 billion in deposits and borrowing throughout its history. However, it has recently lost market share to competitors like Aave, which boasts a total value locked of $14.8 billion, over eleven times greater than Compound's.
The DeFi sector is currently facing challenges, with total value locked across the industry decreasing by over one-third since the beginning of the year, now sitting around $70 billion. This decline has been attributed to a broad market correction, shrinking yields, and a series of security incidents, including the significant $292 million KelpDAO exploit in April. Nevertheless, forecasts suggest the sector could grow to $2.7 trillion by 2030, with tokenized real-world assets expected to be a key growth area, according to projections from Standard Chartered.
Gal Stern, Chief Business Development Officer at deBridge, stated via Telegram, "Now is a great time for initiatives like these, where real capital goes toward both the structural work and the bringing in of bright minds from the institutional sphere who can explain it to a risk committee in their own language. That combination is what brings institutional confidence back."
The new leadership team includes Chief Operating Officer Christopher Donovan, who previously served in the same capacity at the Near Foundation. Steven Liu, who grew Maple Finance's assets from $500 million to $5 billion, takes on the role of Chief Product Officer, while Aaron Schnarch, the former CEO of Coinbase Custody, becomes an executive director. Additional new members hail from firms like Anchorage Digital, HSBC, Broadridge Financial, and Maple Finance, as reported by the company.
In a statement, Schnarch remarked, "DeFi is a remarkable innovation; however, it has achieved limited institutional adoption. Current product offerings fall short of meeting the traditional finance bar, especially regarding compliance and technical requirements."
Ran Hammer, Chief Business Officer at Orbs, indicated that this strategic shift aligns with the changing user demographics in DeFi. "Retail participation is a fraction of what it was, and the chain has quietly become a venue for settlement, execution, and interaction between financial institutions," Hammer explained. "Since DeFi summer, the space has transformed into a new financial layer for institutions. Thus, bringing in leadership that speaks that language is precisely the right direction."
The substantial budget of $52 million, the largest ever approved by Compound's decentralized autonomous organization (DAO), underscores its commitment to this new direction.
Himanshu Sahay, co-founder and Chief Technology Officer at crypto lending firm Arch Lending, noted, "The $52 million and a bench with that much institutional experience is a serious move, and it should improve its execution," adding that institutions will seek more than just credentials, as they "aren't underwriting teams; they're underwriting structures."
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CEX Volumes Hit 32-Month Low While DEX Spot Market Share Reaches All-Time High
CEX Volumes Hit 32-Month Low While DEX Spot Market Share Reaches All-Time High
Combined CEX volumes fell 23.9% to $3.76T in July, the lowest since November 2023, as DEX spot market share climbed to a record 19.5% and RWA perps hit $460B.
By CoinDesk ResearchAug 11, 2026Combined CEX volumes fell 23.9% to $3.76T in July, the lowest since November 2023, as DEX spot market share climbed to a record 19.5% and RWA perps hit $460B.
Why it matters:
Combined CEX volumes fell 23.9% to $3.76T in July, the lowest since November 2023, as DEX spot market share climbed to a record 19.5% and RWA perps hit $460B.
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