Seemingly out of nowhere, one of the most established DeFi protocols is rallying, gaining 77% in a month and 71% in a weekly time frame. At the same time, the news broke that Compound Labs are launching a regulated financial product on the Ethereum blockchain, Superstate. What is happening to Compound (COMP)? We answer this question and round up a Compound price prediction from our own and independent experts and analysts.
Compound Price Prediction 2023–2033
- The overall consensus on the Compound price prediction is that the price of COMP will continue to grow;
- By 2030, the Compound coin COMP can exceed its ATH and the psychological level of $1,000;
- However, there is a discrepancy between various forecasts due to some sources being more conservative than others.
What are Compound and COMP?
Compound is a decentralized finance (DeFi) protocol built on the Ethereum blockchain. It lets users lend and borrow cryptocurrencies without the need for intermediaries such as banks.
The main feature of Compound is its algorithmic interest rate model. Instead of having fixed interest rates, they are determined by market supply and demand. Compound’s interest rates can fluctuate in real time based on the borrowing and lending activities within the protocol.
Users can deposit their cryptocurrencies into the Compound protocol and earn interest on their holdings. The interest earned is proportional to the amount deposited and the prevailing interest rate. The interest is accrued in real time and can be withdrawn at any time.
On the other hand, users can also borrow cryptocurrencies by using their deposited digital assets as collateral. The amount that can be borrowed is determined by the collateralization ratio, which is the value of the collateral compared to the borrowed amount. If the collateral value falls below a certain threshold, the collateral will be liquidated to repay the loan.
Compound uses a native token called COMP. These tokens are used for governance: holders can propose and vote on changes to the protocol. Additionally, users who interact with the protocol by lending, borrowing, or providing liquidity earn COMP tokens as rewards.
Compound provides an efficient way for users to earn interest on their cryptocurrencies and borrow funds using their existing holdings as collateral, with no intermediaries. It has gained significant popularity within the DeFi space and has contributed to the continued growth of decentralized lending and borrowing.
To learn more about the protocol and COMP, check out our Beginner’s Guide to Compound.
COMP Price History
Compound Price in 2020-2021
COMP tokens arrived on the market in the very midst of the DeFi summer: in fact, Compound started the “yield farming” trend. Also known as liquidity mining, this is a practice of earning additional rewards from providing liquidity in the form of liquidity provider (LP) or governance tokens.
The program was launched to a resounding success when COMP was worth $338 but soon became oversold and corrected. For the rest of 2020, COMP mostly stayed between $100 and $200. The year closed with COMP at $150.
In early 2021, COMP price caught on to another market trend, this time following the Bitcoin rally. It peaked in May when Compound (COMP) reached the current ATH of $911.20 (May 12, 2021).
The mid-year respite and renewed bull run did not see COMP reach quite the same height, and after touching $500 it was enclosed in a downtrend.
Compound Price in 2022-2023
In 2022, the bull run got exhausted, and the price rapidly started to correct itself. By March, it briefly touched sub-$100 levels before the bounce around the time of the COMP reward halving. This could not sustain the recovery and the fall continued until the yearly low of $28.73. In the remaining half of 2022, the price fluctuated between $30 and $60.
The start of 2023 saw another dip to the $30 area which was followed by a surge to $50. It was contributed to the upgrade to Uniswap V3 data feed, from V2 but the general sentiment in the crypto market seemed to have shifted after an arduous 2022 as well. In 2023 so far, COMP has been wildly fluctuating, having reached its all-time low price of $25.55 just ten days ago. From there it shot up to the current levels on the news about Arbitrum migration and Superstate — more on both below.
At the time of writing, the COMP price is $62.20, and the token ranks 80th by market capitalization according to CoinMarketCap.
What Can Influence the Price of Compound?
Protocol Improvements
COMP is a governance token that represents voting power, so it is particularly desirable for frequent Compound users. Protocol improvement proposals can spark interest in the token and drive the Compound’s price up.
For instance, in February 2021, when COMP holders were voting to increase the collateral factor of the WBTC market, the COMP price was pushed from $382 to $555. Another example is the aforementioned COMP reward halving on March 27, 2022. The community voted to change the COMP distribution model and reduce the emission of the token.
In May 2023, Compound joined the Arbitrum ecosystem, bringing one of the most popular lending DeFi protocols to one of the most used Ethereum scaling solutions. Users of both networks can benefit from the reduced gas fees, especially when yield farming.
Institutional Interest
The unique qualities of DeFi are catching the interest of institutional investors. Digital currency investment company Grayscale unveiled a DeFi fund that includes COMP tokens to their clients in July 2021. The team behind the project, Compound Labs, moved in that direction by establishing Compound Treasury in the same month. It is a company that seeks to offer institutional investors all benefits of Compound without the need to engage with the protocol directly.
Two years later, the interest is still there. Now, Compound Labs sought registration with the SEC for a new product and company. It is called Superstate and is essentially a government bond fund on the Ethereum blockchain. The ongoing price action is most probably due to this development, as the U.S. Securities and Exchange Commission is cracking down on unregulated crypto offerings and businesses. It seems that Compound Labs agree to walk the controversial path to compliance laid before the crypto companies by this government agency.
Challenges of Decentralized Governance
The Compound protocol is essentially governed by a decentralized autonomous organization (DAO) which creates challenges in maintaining the protocol and reacting to emergencies.
Proposal 62, an update that was implemented in September 2021, contained a bug that caused a $74 million loss of funds. The damage was so great not because of the severity of the bug but because passing a hotfix by voting was time-gated.
The governance process is slow by design, giving all COMP holders across the world enough time to review the proposals and vote. However, cases such as this emergency could motivate the community to introduce changes to the voting process going forward.
Our Compound crypto price analysis and forecast
The Compound (COMP) price action took it from the undervalued area straight to a yearly high. The relative strength index is also in the overbought area now, even though it is holding above its simple moving average. A correction short-term is more likely, so we plot the possible support levels: $59.35, which has not been tested yet. The next one would be $52.27, and this level has seen more validation. If this is not a fakeout rally and the upward trajectory continues, the resistance level of $94.42 will be the confirmation of a new price range.
Compound Crypto Price Prediction 2023
YouTuber Cilinix Crypto gives a short-term Compound price prediction, charting two scenarios with technical analysis.
In the bullish case, after establishing a $64 support, COMP can go to $75–76 next. In the bearish scenario, once the price of COMP drops below $64–63, it can eventually go down all the way to $43.
Prediction service LongForecast projects that the downtrend in COMP’s price can come to an end quite soon. Starting in July, possible highs will exceed $140 and reach $144.90. The bullish trend is forecast to persist, and until September, the range will keep moving up and peak at $183.20. The projected closing price for COMP in 2023 is $126.40.
Captain Altcoin analysts use the Elliot waves to predict possible trends, as well as support and resistance levels. The current support lies at $39, the closest resistance is $64.71, and after that, the bullish short-term target is $100.
COMP Price Prediction for 2024 and 2025
In 2024, the CryptoNewsZ team says, COMP can reach a degree of adoption that would drive the demand for COMP for the price to reach the average price of $81.29. The minimum price they forecast is $66.64, and the highest COMP can trade in a year is $95.93.
Going by projections of the DigitalCoinPrice prediction service, on average the COMP coin in 2025 will be worth more than $200. Moderate price volatility will be observed, with highs reaching $212.73 and lows being $184.39.
In 2025 the CryptoNewsZ team expects a new market cycle to follow after the next Bitcoin halving. However, their COMP forecast is conservative, and the reasonably expected peak is just $117.87.
Compound Price Prediction 2028
Another moderately bullish forecast for Compound in the next five years is given by PricePrediction.net. Using historical data for COMP, they predict growth from the minimum price of $272.99 in January to the $467.57 maximum price at the year’s close.
Analytics by Finance Shots plots the upward trajectory of the average trading price of COMP in five years. According to their data, in 2028 the average price of COMP will reach $365.63. The lower range will land closer to $352.67 while the maximum price should not exceed $381.77.
Compound Price Prediction 2030, 2033
In a more distant future, who knows what the crypto market will look like? Some services and experts still try to give an educated guess.
The Cryptocurrency Price Prediction website puts the end-of-decade target in the $1,082–1,352 range. Fundamental analysis by Crowd Wisdom puts the estimated COMP price in 2030 close to $761. Finally, an even more conservative forecast by AMB Crypto sees Compound (COMP) trading between $326.17 and $489.25 exactly ten years from now, in 2033.
How to get COMP on ChangeHero?
The process of buying COMP with crypto on ChangeHero is not complicated at all. It only takes five steps:
- Choose the currencies on the home page, amounts, and the type of exchange. Provide your COMP wallet address in the next step and check the amounts;
- Double-check the provided information, read and accept the Terms of Use and Privacy Policy;
- Send the cryptocurrency you will be exchanging in a single transaction. Fixed Rate transactions have a 15-minute limit;
- And now, relax! We are doing all the work: checking the incoming transaction and doing the exchange as soon as it arrives;
- As soon as the exchange has been processed, your COMP is on its way to your wallet. We’ll be happy to hear your feedback if you enjoyed using ChangeHero.
The support team is always available in chat on our website, official Telegram group, or through email: [email protected].
Conclusion
Compound is one of the leaders on the current market and DeFi but that could always change. It is now up to the COMP holders to keep the protocol in the game and keep it growing.
You can always find more about Compound and adjacent projects in our blog. For daily content, subscribe to ChangeHero on Twitter, Facebook, Reddit, and Telegram.
Frequently Asked Questions
Will Compound coin reach $1,000?
Only the most bullish Compound price prediction out of the reviewed ones sees COMP above $1,000. Even so, it is not expected to occur before 2030.
What will the Compound price be in 2030?
Various sources give estimates in the range between $761 and $1,352 for Compound in 2030.
What will Compound be worth in 2025?
According to different analysts, in 2025 Compound price can grow to $117.87–212.73.
How much will COMP be worth in 2023?
While not certain, analysts predict that in 2023 COMP will be changing hands for up to $183.20.
Disclaimer
This article is not a piece of financial advice. No price prediction is guaranteed to provide exact information on the future price.
When dealing with cryptocurrencies, remember that they are extremely volatile and thus, a high-risk investment. Always make sure to stay informed and be aware of those risks. Consider investing in cryptocurrencies only after careful consideration and analysis and at your own risk.
