Observers of Compound sees the key factor behind Compound’s growth over the past 24 hours is the launch of a new DeFi cryptocurrency called YAM for the Yam protocol. As Compound is a coin supported to “farm” the cryptocurrency, demand for the asset has picked up, hence the ongoing price increase. Just a year ago, Compound proved its mettle when all the other cryptos are falling.
When both Bitcoin and Ethereum are both plunging 5% in the past 24 hours, plunging as gold and the U.S. equities market drop, some cryptocurrencies are holding strong, among them was Compound (COMP). The Ethereum-based Compound (COMP) coin is the native governance token for Compound. COMP was up 7% in the past 24 hours, rallying to $190 and as high as $210 on decentralized exchanges.
Fast-forward to 2021, and COMP has since then gained much ground. Compound is an algorithmic, autonomous interest rate protocol built for developers, to unlock a universe of open financial applications. Let’s take it slowly for a full realization.
Courtesy: Trading view
Compound is a special decentralized finance (DeFi) protocol that is popularly known to pioneer yield farming. The protocol runs on the Ethereum network, and it essentially allows its users to borrow and lend money without any central entity or governance. The success of this project is a direct boost to the Ethereum token as well.
The DeFi protocol is governed by its native token, Compound coin, with the ticker name of COMP. Compound coin allows its community members to make governance decisions about the protocol through a voting system. Voting rights are given to those who hold the Compound governance token.
Users of the platform can vote on several issues such as interest allocation, which coins to add to the platform, and many more. Therefore, it promotes transparency and trust, which is a vital aspect of any blockchain project.
Arguably, the Compound Comp has had an impressive bull run since its launch in 2018. The compound coin has increased significantly in price over the years. Essentially, the Compound protocol has witnessed significant growth margins due to the increase in activity within the network. The platform has attracted several investors, which, in turn, has led to enormous increases in its Total Value Locked (TVL).
TVL is the total value of assets locked within a particular protocol. In this case, the Compound platform’s TVL covers its Liquidity pool and collateral deposits available.
According to various compound forecasts, compound price prediction indicates an excellent token to invest in due to its steady increase in price and powerful technology that is believed to withstand the test of time.
Before we analyze the price volatility of Compound coins using technical analysis, let’s find out what Compound is.
What is Compound?
The Compound project is a decentralized platform that runs on the Ethereum blockchain. It is governed by the Compound coin. The compound governance coin has appreciated over the years since its launch in 2018. As a DeFi protocol, Compound hosts lending pools to earn interest on various cryptocurrencies. These pools allow token holders to supply their tokens to others who borrow those tokens at algorithmically set interest rates based on supply and demand.
The platform provides cryptocurrency holders with an opportunity to earn extra coins through yield farming. Its governance token, Compound, is used to pay for transaction fees within the Compound blockchain.
When Compound was launched, it aimed to create a platform for users to use their cryptocurrency coins that sit idle on exchanges. It offers an automated lending platform that allows users to take out loans against their collateral. At Compound, cTokens are issued as a token representation of the total amount of collateral deposit.
The compound coin is a good investment that propels DeFi to the next level, assuring users of the project’s longevity. Comp tokens are expected to continue to rise in value despite the short bearish momentum that has clouded cryptocurrencies recently.
Due to its promising future, the Compound project has managed to impress crypto experts, claiming that long-term investors can benefit immensely from investing in it. Compound comp sits at position #59 on Coin Market Cap rankings by market capitalization with a value of $1,805,275,087.
Compound price history and technical analysis
Courtesy: CoinMarket Cap
The price history of Compound tokens is exceptionally vital in determining the future price of Compound tokens. We try to establish a Compound coin forecast using advanced trend analysis combined with fundamental price action analysis.
According to Coingecko’s data, the Compound price has been stable since its launch and has increased steadily. It has a total supply and maximum supply of 10,000,000 tokens with 5,708,902 tokens in circulation.
Compound comp price recorded its all-time low price on June 18th, 2020, when it traded at a daily price of $$61.32. Consequently, the asset price of Compound rose tremendously after that until May 12th, 2021, when it recorded an all-time high price of $$910.54.
Compound price analysis of the trend line indicates that Compound prices will continue to increase in value in the following years. According to some analysts, the price of Compound could easily surpass that of Ethereum in the future.
Based on the live Compound coin price, we establish its price forecast for the future years to determine if crypto enthusiasts should consider investing in it for both the short and long term.
Pros and cons of investing in Compound
Investing in futuristic or revolutionary ideas has always proven to be profitable for individuals if the projects succeed. As for Compound, the occasional price drop experienced in the crypto space has not altered the long-term speculated growth of Compound tokens price.
There are pros and cons of investing in any crypto asset; however, since Compound offers revolutionary financial services to crypto users, the technology is poised to record impressive gains in the future. Lending tokens on Compound are a great way to have your crypto holdings acquire compounding interest over time.
Compound currently hosts 14 pools of different cryptocurrencies like Ethereum, Uniswap, and also stablecoins like DAI. Each of these pools has different lending and borrowing interest rates which are the same for everyone independently of how many tokens they supply or borrow.
Considering Comp forecasts, buying and holding Comp token exposes investors to manageable risks implying that risk-tolerant investors can benefit from buying and holding the token. Similarly, the token price is quite volatile, experiencing several price spikes in its trendline.
The cryptocurrency market exposes investors to risks, and indeed each crypto coin has a different risk profile compared to the other. With the current bearish trend of Compound token prices, it is challenging to determine if its a profitable investment or not.
By looking at the price prognosis of the Comp token, let’s establish some pros and cons of investing in Compound.
Pros of investing in Compound
There are benefits of investing in DeFi tokens like Compound based on Comp predictions. The platform supports an automated lending and borrowing system that utilizes smart contracts and other DeFi features. The Compound pool provides adequate liquidity, allowing the lenders to have enough security, eliminating any chance of losses from common occurrences such as loan defaulting.
Here are some reasons to invest in Compound Comp
- It provides an opportunity for crypto enthusiasts to invest in the promising DeFi sector.
- It can grow in value over time since it is backed by solid and well-established technology.
- Currently, the price of one Compound coin is underpriced, giving investors a chance to earn interest on their investments in the future.
- Due to increased activity on the crypto exchanges and an increase in its 24hr trading volume, the price of Compound digital asset has become increasingly volatile, allowing short-term traders and scalpers to make short-term trades.
Cons of investing in Compound
There are several risks involved when investing in compound tokens. According to some experts, the crypto coin is going to witness a slightly prolonged bearish trend. Digital assets like Compound offer crypto risks and expose investors to risks particular to the blockchain project itself.
Below are some reasons to investing in Compound.
- The technology is relatively new and already has competent competitors such as Aave that is equally as promising.
- The long-term Compound forecast is highly speculative, and since crypto is highly volatile, some risks cannot be accounted for in the comp tokens price prediction.
Market prediction for Compound price prediction 2021
Compound Price prediction 2021 for Compound coin indicates a somewhat bearish trend until the end of the year. The cryptocurrency market is relatively inactive. There has been a significant reduction in the reserves of Bitcoin on both centralized and decentralized exchange platforms.
The bearish trend is, however, not predicted to last long. Therefore according to Compound coin price prediction 2021, Compound comp price will continue to be bearish until the end of the year but will pick up in 2022 and continue with a bullish trend for a long time.
Based on the current price of Compound, the Comp price prediction by the end of the year is $ 264 for the minimum price and $ 391.056 as the maximum price. Compound analysis for the Compound price forecast indicates that the expected price of Compound by the end of 2021 will be $311, which means a 9% reduction in price.
Compound’s price forecast is based on Compound price history, the Compound price today, and information derived from moving averages. However, some of these predictions may vary slightly from the actual future prices due to volatility.
Compound price prediction from TradingBeasts
Courtesy: Trading Beasts
Trading Beasts has conducted their research on the Compound coin, and they have established that the token is generally an excellent investment for the long term.
According to their Comp prediction, the DeFi token will experience a minimal reduction in its price towards the end of 2021 since the trend is relatively bearish.
However, after 2021, the crypto space is expected to pick up and gain momentum; consequently, Compound coin price prediction indicated a relatively bullish trend afterward.
According to Trading Beasts, the Compound coin is likely to record a minimum price of $265.918 and a maximum price of $312.845. Such changes imply that investors are better off if they keep off the token for the short term as no significant gains are likely to happen between the current price and the futures prices at the end of December of 2021.
Compound price forecast from Wallet Investor
Courtesy: Wallet Investor
Comp coin price prediction, according to Wallet Investor, indicates a different market sentiment. In essence, their data suggests that the crypto token will continue to increase value in USD predictions. Comp forecast often considers several aspects of the crypto space, and since different forecasts focus on various aspects of the trend variables, variations in the outcome are inevitable.
According to them, Comp price will record a minimum price of $310.779 and a maximum price of $628.310 in USD predictions. There is a wide variation in the data, and it is noticeable that the considerable variation comes in the expected maximum value.
According to compound price prediction 2021, there is a potential for the bulls to overcome the bears, and it can pick up an upward momentum before the end of the year.
The compound forecast shows that the expected average Compound price for Compound comp by the end of the year will be $466.177, indicating a price increase from the current price.
Cryptopolitan’s verdict on Compound
Cryptopolitan confirms that Compound is an excellent long-term investment. Careful considerations of the Compound prediction indicate that the token can increase exponentially in the future, earning interests for its investors.
Value investing is encouraged even in the crypto space, and investors are encouraged to conduct their research on crypto projects before determining their long-term viability.
According to Cryptopolitan, Compound is a solid blockchain project in the DeFi space that has gained traction over the years. Therefore, the project’s validity indicates that Compound comp has a bright future, making it an excellent investment to earn interest.
Compound price prediction for 2022
Courtesy: Trading Beasts
Cryptos and DeFi, in general, are expected to pick up by the first half of 2022, and virtual currencies are expected to commence a bullish trend. This bearish momentum creates a resistance level to sustain an impressive bull run that will dominate in 2022.
In 2022, we expect growth in decentralized finance, and Compound coin will likely close the year with a possible low price of $309.898 and a high price of $455.732 in USD predictions. The average expected price is $364.585, indicating a 5% increase.
Compound price prediction for 2023
Courtesy: Trading Beasts
In 2023, the bull run is expected to continue its bullish momentum even more aggressively, and the Compound coin will also increase significantly in value.
Comp price prediction 2023 shows that the token will have prices ranging from $486.618 to $715.614, with the expected average price of $572.492. The growth is approximately 65%.
Compound price prediction for 2024
Courtesy: Trading Beasts
Compound forecast for 2024 indicates a continued price increase from today’s price. The forecast indicates that the Compound comp price will range from $603.411 to $887.369 will a mean value of $709.895 by December of 2024.
Compound price prediction for 2030
By 2030, several aspects of the market will have changed, and if DeFi succeeds until then, we expect significant increases in the value of Compound cryptocurrency. The Compound coin can trade at $5000 in 2030.
Compound price prediction for 2035
By 2035, the prices of Compound, assuming the market growth remains relatively the same, could hit a record high of $9000.
The Compound platform allows users to take out loans in DAI, which is a DeFi stablecoin. The stablecoins can then be converted to fiat currency, depending on your needs. The platform generally offers affordable exchange rates, and since it is a DeFi platform, it has increasingly boosted investor confidence.
The token, Compound, offers massive growth potential in the future, and individuals are encouraged to invest early to benefit from the high potential future returns.
Here are some frequently asked questions by crypto investors about the Compound coin and its viability as an investment opportunity.
Is Compound a safe investment in 2021?
The compound token is a generally safe crypto investment for the short and long term. The safety of any crypto investment is mainly established by the solidity of the project to determine its probable lifespan. Compound project is a solid DeFi project that is expected to dominate the DeFi space.
What are the risks of investing in Compound?
There are no significant risks that precede the normal risks investors take when trading in the crypto market. However, Compound faces competition from Aave, which may affect its performance if Aave offers better services than Compound in the future.
Where can I buy Compound crypto?
You can buy Compound tokens on several centralized and decentralized exchange platforms. Today, you can purchase Compound crypto on Binance, Coinbase Pro, and Huobi Global. The compound coin is also traded against fiat currencies such as USD on most of the exchanges.
Should I invest in Compound?
Depending on your risk tolerance and preference, a Compound coin can be an excellent investment or not. Short-term investors may not reap good profits from Compound this year considering the forecast; however, forecasts indicate a nice bullish trend from the beginning of 2022. Therefore, long-term investors can invest in Compound. Shorte term interests in Compound coins are encouraged for day traders and scalpers.
Is Compound profitable for short-term investors?
Short-term interests are in Compound is discouraged for holders. Holders do not engage in everyday market trading, and short-term fluctuations are widespread for Compound. To make considerable profits on Compound, short-term investors should participate in data-based trading to earn returns.
Should I buy and hold Compound for the long term?
Yes. Compound coin price forecasts indicate an apparent positive growth in the future. Since the DeFi project is certified as a credible long-term project, investors are encouraged to conduct more research on the project and invest wisely. However, according to the price forecast, the Compound coin is an excellent investment to buy and hold for the long term.
Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.