Background
As Compound grows, the relationships we need to maintain grow as well. The team will network with large protocols to understand the strategies that are available with their tokens; all in the name of bringing their communities onto Compound.
Every ecosystem on which we deploy Compound has its own champion protocols, with new assets, strategies, and yield opportunities to explore. The New Assets & Markets team assists the New Chains team in gathering information necessary for optimizing launch strategies.
Additionally, the New Assets team will continue to optimize ecosystem performance after the New Chains team has departed post launch. The New Assets & Markets Team will work with our partners to increase utilization, fulfill each partner’s desired roadmap, and arrive at success alongside the partner.
The New Assets & Markets deployed 12 new markets and 67 new collaterals in 2024, and will bring more intentionality and focus to each partner as its own team, in 2025.
Thesis
When Compound aligns closely with the objectives of our partner protocols, we can better negotiate treasury deals and attract sticky, long-term deposits onto Compound. To accomplish this mission, the New Assets & Markets Business Unit will provide high-touch, customized solutions & support to Compound partners.
Members
The team will initially be led by Shardul Pilley, who will work to hire supporting members and impart the knowledge he’s accrued while running the New Assets & Markets team throughout 2024. Staff from across AlphaGrowth will support Shardul until his team has been solidified.
Process
We typically begin work with new assets by evaluating their protocol from all sides. We assess their liquidity depth, growth momentum, Protocol Owned Liquidity, integrations with other protocols, and sources of yield. We then look at what assets are held in their treasury, and we speak with them about their roadmap. By collating this information, we form an understanding of what our partnership could look like, and what we can ask of them in terms of liquidity deals that benefit Compound.
We then codify the best strategies available into structured products, and then work together on incentive campaigns to promote our partnership. Together we jointly create content to publicize the opportunity to their users and we both apply APR incentives to draw attention.
We maintain relationships, and prioritize strategies that have potential as longer term sources of yield. We also prioritize strategies that educate the crypto market and align with Compound’s underlying treasury management needs … always with the goal of dissuading the participation of mercenary capital.
Cross Collaboration
Compound has four new chains in the pipeline for development, and each is a potential opportunity for Compound. The New Assets team will work closely with the New Chains team to research what new markets should be implemented, to ensure the chain’s greatest chance of success after Compound launches. The New Assets team will then stick with the chain after the new chains team departs to continue researching expansion opportunities.
While New Chains maintains a macro view on the Ecosystem, New Assets zooms in to the ground level, and engages with listing partners to find the best strategies for launch.
Close collaboration between our teams helps us
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Compete with Aave’s Collateral Factors
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Keep strategy and meta narratives current and exciting for users
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Choose the right market structures with high demand
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Quickly adapt to the needs communicated by protocols
The New Assets & Markets Team also works alongside the Incentives & Structured Products and DeFi Ops Teams. Examples of strategies the New Assets team will pursue include:
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Providing additional attention to Threshold who is offering native minting for tBTC on Arbitrum, and has been looking for a Premiere Lending Partner for Arbitrum Markets since November ‘24. Offering further support will help Compound become a priority in their 2025 roadmap.
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Researching and engaging with the leading protocols on Mantle like Merchant Moe, and investigating how Compound can integrate yield-bearing assets, and access existing points programs. We will uncover grant-matching opportunities, and high-momentum strategies, and pass those onto the Incentives & Structured Products team to execute.
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Uncovering opportunities to collaborate with Shadow DEX on Sonic (part of the new chain pipeline) so we’re ready when Compound goes live. The team will also help the assets we list on Compound compete against each other to build xSHADOW positions, and drive additional incentives back to their Protocol Owned Liquidity. Collaboration with the DeFi Ops team will help Compound do the same thing for its COMP token.
The New Assets & Markets Business Unit provides Compound with the focus and skill to manage these relationships, and catalyze growth one niche at a time.
Past Success
Research that uncovers highly desirable assets and market constructions can lead to large inflows of TVL. For example:
- Comparing Compound to competitors showed a large market opportunity for USDT on mainnet. When Compound added USDT on Mainnet it drew $200M in TVL with little to no marketing.
- Additionally when sFRAX was added as collateral on the USDT market it instantly attracted $20M in TVL as our biggest competitor hadn’t listed sFRAX.
- Arbitrum market listings enabled our Incentives Team to launch an incredibly successful LTIPP Campaign.
- The collaterals that we added caused a humble increase of 800M in TVL supplied on Compound. Dune: https://dune.com/queries/4059859/6835732
Our current markets are full of potential ready to bloom. The New Assets & Markets Team will take an active role to push emergent market decisions into more intentional paths, cultivating further success in 2025.
Testimonial
Budget
9,200 COMP, for a dedicated team to run this business unit on Compound’s behalf for the duration of 1 year.
Roadmap
New Chain Initiatives
The Assets Team will support research and discovery efforts required to launch Compound on Linea, Unichain, Sonic & Ronin in the immediate future, with additional chains to follow.
Market Initiatives
Revenue for Compound, and our depositors is only possible when market utilization is around 90%. The majority of Compound markets are at 90% utilization, which is a testimony of the success of our asset strategy.
The New Assets and Markets team will continue to bring Compound to this point of greatness by improving market utilization on existing markets across the chains where Compound is deployed.
For example, the AERO Market on Base represents an unrealized opportunity for growth, and has a clear set of communities to serve. In the linked article, we outline a strategy for healing the AERO market that the Assets Team will pursue.
We are actively exploring and executing other strategies for Mantle, Sonic, and other ecosystems in our New Chains Pipeline.
Asset Initiatives
The team will also be responsible for analyzing current collateral supply caps, and alerting Gauntlet should partners require timely updates in anticipation of upcoming campaigns. Conversely many collaterals approved before the Growth Program’s inception have incredibly low utilization. This team will address these issues, uncovering why they occur and generating solutions.
The team will take an intentional approach when listing collaterals. Before listing, each asset should have a Compound growth strategy including a Liquidity Deal and Structured Products that utilize the asset. We can then closely align our support to their stated needs and be ready to raise supply caps when their asset increases in demand.
Our Asset roadmap includes Inverse Finance, EigenLayer, and other fast growing assets on chains where Compound is deployed.
The New Assets & Markets Business Unit is necessary to evaluate our current market performance, align with our partners on their needs, vet opportunities for more intentional Asset & Market choices, and take swift action to respond to market demand before our competitors.
Questions?
This document is intended to educate community members on the value generated by and general activities of a New Assets & Markets business unit. If there are additional questions you’d like to know please ask them below, we’re happy to answer, though some answers may be during office hours to protect strategies that are more valuable if they cannot be easily copied by our competitors.