Compound initiates its first decentralized governance proposal, voting on whether to support USDT.

According to an article released by the decentralized lending platform Compound on April 27th, the platform has initiated its first governance proposal decided collectively by COMP token holders. This marks a significant milestone for Compound towards decentralized governance.

The First Decentralized Governance Proposal on the Platform

Compound is a decentralized lending platform built on blockchain, which can be simply understood as peer-to-peer lending. The platform initiated a proposal on April 27th to "Add Support for USDT," marking the first governance proposal decided by the community on the platform. Although Compound platform is based on a decentralized protocol on the blockchain, the development team still holds most of the authority in governance for the initial development of the protocol, such as the decision on "whether to add support for new tokens," which was previously in the hands of the development team. It wasn't until the end of February this year, after Compound issued governance token - COMP, that governance on the platform gradually transitioned to the community. This "Add Support for USDT" governance proposal is also a significant milestone for Compound.

The current voting result shows that 86.35% agree to add the USDT token, with only 13.65% opposed.

The voting period for this proposal will last 72 hours. If the majority agrees to the proposal (at least 400,000 COMP), the proposal can be executed two days after the end of the voting.

Adding USDT to Address User Exodus Crisis

Decentralized lending platforms are facing serious challenges, as reported earlier, due to the deleveraging and liquidity risks caused by the market crash in March, leading to persistently low borrowing rates on lending platforms. The borrowing rate for Dai, the stablecoin with the best borrowing rate on the Compound platform in the past, has now dropped to only 1.67%. The following is the amount of Dai held by users on Compound, showing that investors are withdrawing funds after losing the borrowing incentive.

USDT is currently the most liquid stablecoin in the market with the highest market demand. It can be reasonably speculated that the Compound community's proposal to add USDT is largely to address the current user exodus crisis.

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