Compound Foundation has launched a permissioned lending market exclusively for institutional borrowers. This initiative splits the protocol's liquidity into two separate layers, providing whitelisted entities with custom collateral sets, loan-to-value ratios, and risk parameters distinct from retail users.
The project is supported by a $52 million development program approved by the DAO in August. The two-year budget includes an initial disbursement of $14 million, with the remaining funds contingent on reaching specific milestones. The program aims to attract banks, asset managers, and fintech firms.
A new executive team has been appointed to lead the institutional transition, including Executive Director Aaron Schnarch, COO Christopher Donovan, CPO Steven Liu, and CTO Leo Eikelman. The foundation currently reports over 10 confirmed partners and is in talks with more than 20 potential collaborators.
The infrastructure includes new compliance tools for KYC and AML, as well as support for real-world assets like tokenized bonds and treasuries. Compound currently holds approximately $1.2 billion in total value locked, down from a peak of $12 billion in September 2021.
