Having studied Compound for the few weeks (as I’m shorting COMP) this is what I’ve found on this topic so far. The website describes COMP’s utility as follows:
Compound (COMP) is an ERC-20 asset that empowers community governance of the Compound protocol; COMP token-holders and their delegates debate, propose, and vote on all changes to the protocol.
So it seems the real intend here is for COMP to be the token for governance. But Compound isn’t fully giving up control just yet. About 40% will be distributed over 4 years to the community, some are with investors and most are still with Compound and the team. (Although I found it hard to get good info on this) So for the next few years Compound will likely keep the ability to jump in and veto any proposal they really don’t like. So while the ultimate goal is decentralized governance, this is still a few years away I think.
As mentioned before here and on discord, one of the issues with dividends is that it could means COMP is seen as a security. So until the 4 year distribution is done or Compound registers COMP as a security or something like that… it may cause real legal issues for Compound if COMP paid dividend.
The second issue with this is that currently a small fee goes into the reserves. These reserves exist to cover black swan events in which case Compound goes insolvent. Paying dividend would come out of these reserves and would increase the risk a black swan event poses. I think the reserves are still rather small at the moment. Last I checked there was around $1.4M in all reserves combined. And even with the yield farming going on now it’s only growing by something like $6.500/day.
So the parties who currently have the voting power for COMP seem to view COMP as intended: the governance token of Compound. If you are interested in voting on decisions regarding Compound, buy some COMP. Or better yet, use Compound to receive COMP.
Since most vote holders are on this forum, please correct me if I’m mistaken anywhere, because all my comments here are second hand hearsay and educated guesswork.