What is economic model for a COMP token

Hi,

my first post here, but in general I’m quite deep in DeFi. I’m using compound Finance and MakerDAO for more than a year.

As in topic.

  1. What is economic incentive for COMP holders not to sell it as fast as possible?
  2. What is economic incentive for COMP holders to make wise governance decisions
  3. Is there any kind of link between success of Compound token and price of COMP token?

Any Comparition to MakerDAO appreciated.

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Great questions … following this for any responses

Questions like these have come up here before, see: Dividend on COMP

As of today the answers I think are:

  1. What is economic incentive for COMP holders not to sell it as fast as possible?
    None as of right now besides a hope/assumption there will be an incentive added at a future date.

  2. What is economic incentive for COMP holders to make wise governance decisions
    None as of right now besides a hope/assumption there will be an incentive added at a future date.

  3. Is there any kind of link between success of Compound token and price of COMP token?
    None as of right now besides a hope/assumption there will be an incentive added at a future date.

The trading of COMP is purely speculative at the moment. Currently the only utility the COMP token has is voting rights.

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I posted some thoughts here yesterday. Basically the COMPs are a way for the investors and founders to monetise their work. The team have a vesting schedule over 4 years, probably similar to stock options.
At current market prices, you’d need to control about 400k x $150 = 60mn USD worth of the stuff to make decisions. That’s a lot of money for attending a shareholder meeting, no free drinks.