A report from Flipside Crypto contends that investors are dumping Compound tokens as soon as it gets listed on exchanges with the majority of the supply held by speculators.
A report by Flipside Crypto states that investors are liquidating their Compound (COMP) holdings as soon as the opportunity presents itself; with major exchange listings acting as catalyst.
COMP flows. Source: Flipside Crypto.
Exchange listings led to dumps
The report states that as soon as COMP was getting listed on major exchanges like Binance (BNB) or Coinbase, there were observing major flows from the investors to exchanges. In addition, there was allegedly a larger transfer made from “the Compound team to DeFi. This correlates with the unannounced listing of COMP on Uniswap”.
When trading on Coinbase ensued on June 23, it caused “a large drop in price, probably driven by this one investor liquidating.”
COMP price. Source: Nomics.
Most of Compound users are speculators
The report finds that the vast majority of Compound users are speculators who do not engage in lending and borrowing, stating, “Compound users hold 23.8K of the active supply, while wallets who are not using the protocol hold a whopping 680.4K.”
Nonetheless, Compound has experienced rapid growth in the last couple of months. It overtook Maker (MKR) in total value locked (TVL) of Ether (ETH) according to a recent ConsenSys DeFi report:
“On June 21, for the first time, Compound’s TVL surpassed that of Maker’s. By the end of the quarter, $392M USD was locked in Maker and $570M USD was locked in Compound.”
We approached Compound Finance CEO Robert Leshner for comment, but he said “I won’t go on record and debate false information, it gives credence to bad reporting and smears. I will however, after your article is published, point out how flawed it is.”
Source: , CoinTelegraph
Articles listed with Cash Tech News as the author are either general information, or may have been imported from another website, to bring our readers a rich media experience that encompasses articles that we find interesting, as well as those curated by others.
The views and opinions expressed here are for informational purposes only, and should not be confused with professional financial advice. These opinions are solely those of the author and do not necessarily reflect the views of CashTechNews.com. Every investment and trade involves risk. You should conduct your own research, and contact your professional financial advisor before making any investment.
Corrections, feedback, and ideas should be submitted through the website contact form.