Compound has long been one of the largest and most popular DeFi lending protocols, second only to MakerDAO as of now. The team initially launched Compound v2 in May 2019 and have since introduced many upgrades and tweaks to the protocol. Recently they also established decentralized governance powered by COMP tokens which has already introduced multiple community proposed updates.
We initially added support for Compound in June 2019, with at that time extensive wallet support and unique direct interactions between Compound and MakerDAO. As of then, however, our focus has mostly been on MakerDAO with work on Automation and features for Multi-collateral DAI.
Today we’re moving the spotlight back onto Compound and introducing a completely new DeFi Saver Compound experience.
Completely redesigned UI
We have completely redone our Compound interface, with the goal of providing all the needed information for optimal management of your position in one coherent page.
Our previous dashboard was fairly clunky and required users to focus on a single asset at a time, lacking a global overview of their position and the information needed to make their next decision — no more!
Once you log into our new Compound dashboard you will now be greeted with all balances of your existing position, as well as additional data such as your borrow limit and borrow power usage.
One element that you perhaps haven’t seen before in regards to Compound is the collateralization ratio. This value represents a global ratio of your current collateral value vs current debt and you can also see the minimum ratio for your current position. Keep in mind that falling below the minimum collateralization ratio due to price changes of supplied or borrowed assets will force your position into liquidation.
Advanced leverage control for Compound
Similar to MakerDAO, Compound is also often used to long or short a certain asset, with varying degrees of leverage. We are very glad to share that our signature 1-transaction leverage and deleverage options Boost and Repay are finally coming to Compound today.
Boost for 1-tx leverage increase
Boost is a leverage increase option that lets you quickly and conveniently obtain more of the collateralized asset at the cost of increasing debt.
For example, if you have supplied BAT as collateral and borrowed USDC, you can use Boost to borrow more USDC which will be used to obtain more BAT via one of the integrated decentralized exchanges and then instantly added to your BAT supply — all in one transaction.
This can be used for any pair in your portfolio. For example, if you have supplied ETH and borrowed DAI, then you can also use Boost to increase your ETH exposure by borrowing more DAI which would be instantly used to obtain more ETH for your position.
Repay for 1-tx deleverage and debt payback
Contrary to Boost, Repay lets you reduce debt at the cost of decreased exposure to your supplied asset.
For example, if you have supplied BAT as collateral and borrowed USDC, you can use Repay to take out and sell part of your supplied BAT for USDC and use that obtained USDC to reduce your debt — once again all in one transaction.
Depending on your position, Repay can in some cases even be used to pay back your full debt.
Finally, we should also note that these are the Extended Boost and Repay we initially introduced a few months ago for MakerDAO that utilize Aave flash loans in order to maximize the leverage adjustment possible per transaction.
Introducing Smart Wallets
The standard Ethereum accounts, those we manage via MetaMask or one of the hardware wallets, are unfortunately limited to interacting with only one smart contract per transaction.
Therefore, in order to make Boost, Repay and other unique complex features possible, the use of a smart contract wallet (also called a proxy wallet) is required. Conveniently, we already have one on hand. It’s called the DSProxy, it was developed by the MakerDAO team and it’s probably one of the most audited and battle-tested smart contracts in the Ethereum ecosystem. And, even more conveniently, if you’ve ever had a MakerDAO CDP/Vault or used our Smart Savings dashboard — you already have one and you’re ready to go.
Importing your current Compound position
If you’re already using Compound, you have the option of importing your current position to the Smart Wallet so you get access to Boost, Repay and other advanced features that will be coming soon.
Note that this is not required — you can still use the DeFi Saver Compound dashboard without using the Smart Wallet. The benefit is that you keep compatibility with other apps, such as the default Compound.finance app, though
The interesting part about importing a Compound borrow position is that it involves utilization of flash loans, as there is no simple way to move that position to the Smart Wallet.
These are the exact steps that happen:
1 — An Aave flash loan is made to pay back your current debt
2 — Your supplied funds (cTokens) are moved to your Smart Wallet
3 — The funds you were previously borrowing are borrowed again
4 — The Aave flash loan is paid back with the borrowed funds
And now your initial position is replicated to your Smart Wallet. Of course, this process is conveniently done in one transaction for you, but we thought you would be interested in the exact steps nonetheless.
Just the beginning
This is just the first wave of improvements we’re introducing for Compound users at DeFi Saver. Over the next few months, we plan to expand the Compound feature set with our full array of functions already available for Maker, and more.
This includes our Automation system which has so far been available for MakerDAO CDP/Vaults only. The system provides users with both automatic liquidation protection in case their collateral moves down in value, as well as automatic leverage increase in case it moves up and we’re looking forward to expanding support to Compound.
Additionally, we plan to introduce a protocol and loan converting feature into DeFi Saver that will allow you to move your position between Compound and MakerDAO depending on available interest rates, but also convert your collateral or borrow asset to a different one.
As always, we would love to hear your thoughts, feature improvement suggestions and even feature requests, so feel free to join us in the comments below or on our discord.