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S&P Global Ratings has given a mixed review to a decentralized finance (DeFi) platform Compound's institutional offering.

Compound Treasury (a product of Compound Prime LLC) received a B- credit rating, indicating that the USDC-powered yield platform is "speculative" but "currently has the capacity to meet financial commitments."

In a statement, S&P said of Compound Prime, "the outlook is stable."

Despite the low scores, Compound hailed the rating as DeFi's best. One of the major credit rating organizations looks to be the first to score a "institutional DeFi" product.

In a blog post, Compound Treasury's general manager, Reid Cuming, stated, "[This] signifies enormous progress in the crypto industry's maturity, as established institutions begin to appraise the dangers of digital asset powered financial solutions."

To CoinDesk, Cuming described the rating as a "translation mechanism" for institutions interested in dabbling in DeFi.

"What's really intriguing and important about this is that it shows that DeFi can be quantified, weighted, and incorporated into more standard financial risk procedures, and that traditional finance can also understand it," Cuming said in an interview.

Compound Treasury, which will be launched in June 2021, is aimed at crypto-savvy businesses looking for a return on their capital reserves. According to the product's website, accounts offer a 4% APR on USDC deposits, are categorized as securities, and are exclusively available to authorized institutional customers.

Treasury has yet to find its feet, according to S&P, with "just 20 customers and $180 million invested at the end of April." In comparison, Compound's core DeFi loan platform currently has over $5 billion in total value locked (TVL) in crypto assets.

"Major rating weaknesses, in our opinion, include the company's very low capital base, regulatory risk associated with cryptocurrencies, significant operational risk and complexity, convertibility risk between private stable coins and fiat currency, and the potential hurdles to generate a 4% return," wrote S&P.

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