CoinDesk
Compound Finance overhauled its leadership and approved a record $52 million budget on Monday to revive growth after total value locked on the protocol slumped to $1.2 billion, down from a $12 billion peak in September 2021. The pivot targets institutional users through real-world asset offerings, partner integrations, and credit infrastructure built to meet traditional finance compliance standards. The new team includes Chief Operating Officer Christopher Donovan, formerly of the Near Foundation, Chief Product Officer Steven Liu, who scaled Maple Finance from $500 million to $5 billion in assets, and former Coinbase Custody CEO Aaron Schnarch as executive director, with additional hires from Anchorage Digital, HSBC, Broadridge Financial and Maple Finance.
Why it matters
Compound pioneered decentralized lending in 2018 and has processed roughly $480 billion in deposits and borrowing volume since inception, but it has steadily ceded ground to Aave, which now holds $14.8 billion in TVL, roughly 11 times Compound's current book. Schnarch framed the gap as structural: "DeFi is a remarkable innovation; however, it has achieved limited institutional adoption. Current product offerings fall short of meeting the traditional finance bar, especially as it pertains to compliance and technical requirements."
Himanshu Sahay, co-founder and CTO at Arch Lending, drew the line even more cleanly: institutions "aren't underwriting teams, they're underwriting structures." The $52 million, the largest budget ever approved by Compound's DAO, is the capital to build those structures, and the hires suggest the protocol is buying the language institutions underwrite against, not just the names.
Market impact
DeFi is operating from a weakened base. TVL across the sector has fallen by more than a third since the start of the year to roughly $70 billion, dragged by a broad crypto correction, compressed yields, and a run of protocol exploits including the $292 million KelpDAO hack in April. Standard Chartered projects the sector could reach $2.7 trillion by 2030, with tokenized real-world assets among the fastest-growing segments.
Frequently asked questions
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What is Compound Finance and what is its current TVL?
Compound Finance is one of the oldest decentralized lending protocols, launched in 2018. Its total value locked has fallen to $1.2 billion from a peak of $12 billion in September 2021.
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How large is the budget Compound approved for its institutional pivot?
Compound's DAO approved a record $52 million budget, the largest ever greenlit by the protocol's governance. It is being used to fund real-world asset offerings, partner integrations, and credit infrastructure.
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Who is joining Compound's new leadership team?
Christopher Donovan, formerly of the Near Foundation, joins as COO. Steven Liu, who scaled Maple Finance from $500M to $5B in assets, is CPO. Former Coinbase Custody CEO Aaron Schnarch becomes executive director. Other appointees come from Anchorage Digital, HSBC, Broadridge Financial and Maple Finance.
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How does Compound compare to Aave right now?
Compound pioneered decentralized lending in 2018 and has processed roughly $480 billion in deposits and borrowing since inception, but Aave now holds $14.8 billion in TVL, roughly 11 times Compound's current book.
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What is the broader DeFi market context for this pivot?
DeFi sector TVL has fallen by more than a third since the start of the year to roughly $70 billion, weighed by compressed yields and protocol exploits including the $292 million KelpDAO hack in April. Standard Chartered projects the sector could reach $2.7 trillion by 2030.
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