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Investors File Lawsuit Against Compound Finance

A group of investors has filed a lawsuit against Compound Finance, a popular Web3 lending service, over the performance of its native COMP coin.

Judge Gavel
Judge Gavel

The plaintiffs seek to halt coin sales and argue that it is unregistered with the US Securities and Exchange Commission (SEC).

According to data from CoinMarketCap, COMP trades at $39.44, having fallen 96% from its all-time high of $911.20 in May 2021. At that point, the token had a total market capitalization of around $4 billion, but this has since fallen to around $2 billion.

Compound Protocol Remains One of the Most Prominent DeFi Services

Despite the legal action, the Compound protocol remains one of the most prominent decentralized finance (DeFi) protocols, with a Total Value Locked (TVL) of $1.78 billion, according to DefiLlama, the largest TVL aggregator. In August, the company introduced a new version of its protocol called Compound III, focusing on security, capital efficiency, and user experience while reducing complexity.