DeFi Dissected: A Simple Comparison of UniLend and Compound
- Our DeFi Dissected article series aims to highlight the strengths of UniLend by comparing DeFi protocols, beginning with Compound
- Both UniLend and Compound offer lending & trading functionality, a community governance mechanism, and tokenized assets
- UniLend also offers spot trading functionality, which Compound doesn’t
- Compound supports only a limited set of assets, whereas UniLend offers permission-less listings of any Ethereum-based asset
- UniLend is a unique protocol, built from the ground up, that is capable of truly revolutionizing DeFi
Our community has requested further clarification on UniLend’s distinguishing strengths as a DeFi protocol, so that’s what we’re delivering! To fulfil our community’s wishes, as a community first project, we have come up with the DeFi Dissected series; a series of articles comparing UniLend with other major DeFi players. We take every member’s feedback seriously and hope these articles will help everyone to better understand our many value propositions.
A New Era of DeFi is Emerging
During this DeFi cool down, both institutional and retail investors are looking for the key players who will lead the next major DeFi wave. Based on recent reports, we know DeFi is far from ‘dead’, as some pessimistic short-term market onlookers have claimed. Some reports reveal the Total Value Locked (TVL) of ETH on DEXs is continuing to grow at a considerable rate.
In general, the amount of ETH being sent to decentralized exchanges is already significantly higher than ETH being sent to centralized exchanges (see Rochelle Guillou — On The Flipside). Realizing this, we note, that this is merely the beginning for the DeFi revolution. What people may not realize is that many of the true DeFi leaders of tomorrow are merely gearing up today.
We are extremely confident that UniLend, a protocol seeking to unlock the true potential of decentralized finance, is one that’s going to be dramatically game changing. It has the potential to out-compete existing protocols for a variety of reasons. UniLend is not a fork of another protocol; it was built from the ground up to truly revolutionize DeFi.
Upon release, in the very near future, users will be able to assess it’s edge for themselves. UniLend’s new and innovative protocol has already turned the heads of many prominent investors; so let’s begin comparing existing DeFi platforms one by one.
Today we’ll start by comparing UniLend and Compound side-by-side.
Compound vs UniLend: Key Differences
To start, we can reference the Compound website which reads,
“Compound is an algorithmic, autonomous interest rate protocol built for developers, to unlock a universe of open financial applications.”
Simply put, Compound is a protocol that enables users to lend and borrow. In addition, the Compound protocol allows the community to vote on proposals in regards to the site and protocol.
Users of UniLend will also be able to participate in the community governance mechanism to make important decisions relating to the functioning of the protocol, and will be able to lend/ borrow assets to create new and ingenious DeFi strategies. However, this is just the tip of the iceberg for UniLend, because it will allow users to permissionlessly list any Ethereum-based asset, as opposed to Compound which supports only a limited number of tokens which are decided based on community proposals and voting.
UniLend’s permissionless listing mechanism will enable the user to automatically create separate money markets for each asset, allowing them to lend, borrow and trade these assets without friction, without the need to involve a centralized entity, and without the requirement to propose a vote in order to list the asset like Compound requires.
Although the aforementioned UniLend functions already supersede the capabilities of the Compound protocol, there’s much more that UniLend has to offer. One of the most notable of these features is spot trading, which isn’t available on Compound; users will be able to participate in decentralized spot trading of listed assets, which makes UniLend a one-stop shop for all your DeFi needs.
Similarities of the Protocols
The purpose of this comparison today isn’t to dissuade one from using other protocols, because we understand that users utilize multiple protocols at once and we want to see the whole DeFi ecosystem flourish, but we do want our community and investors to understand the key advantages UniLend offers over other protocols.
In regards to both UniLend and Compound we see that both protocols have, or soon will have, an intuitive and user friendly interface. In addition, they will have the ability to provide liquidity and tokenize assets, like the cTokens on Compound. Both protocols have a unique native utility token and a strong community supporting the future of decentralized finance.
Conclusion: A Unique Facilitator of the Evolution in DeFi
UniLend truly aims to unlock the full potential of decentralized finance with our uniquely comprehensive functionality and permissionless listing model, and we invite you to join us in our endeavour. Along the way, we’ll continue to release articles highlighting key attributes and comparisons between other viable protocols on the market.
To stay in touch, and be one of the first to access these important observations, follow us on our social media outlets and keep an eye out for our future Medium articles.