Compound Bets $52M to Win Over Big Institutions in DeFi Comeback

Compound Finance overhauls its leadership and approves a record $52M budget to attract banks and big investors after its assets crashed.

## A Pioneer Fights to Stay Relevant

Compound Finance, one of the oldest names in DeFi (Decentralized Finance — a system where people lend, borrow, and earn interest on crypto without banks or middlemen), is making a bold move to reinvent itself.

The company just replaced its leadership team and approved a record $52 million budget to chase a new kind of customer: big financial institutions like banks and investment firms.

## Why the Change?

Compound has been struggling. The amount of money locked in its platform — known as TVL (Total Value Locked, meaning the total crypto users have deposited into a protocol) — has collapsed:

Peak: $12 billion in September 2021
Now: just $1.2 billion

Meanwhile, rival platform Aave now holds $14.8 billion, more than 11 times what Compound has.

## The Big Bet on Institutions

Everyday retail traders (regular individual investors, not professionals) have lost interest in DeFi. So Compound is shifting focus to serve professional players instead. It plans to offer:

Real-world assets (RWAs) — traditional things like bonds or loans turned into digital tokens
Partner integrations and credit infrastructure built to meet the strict rules banks must follow

To lead this, Compound hired executives from major firms including HSBC, Coinbase Custody, and Maple Finance.

## The Bigger Picture

DeFi as a whole has had a rough year. Total value across the sector dropped over a third to about $70 billion, hit by a shaky crypto market and hacks — including a $292 million theft from KelpDAO in April.

But there's optimism ahead. Standard Chartered predicts DeFi could reach $2.7 trillion by 2030, with tokenized real-world assets leading the growth.

## The Bottom Line

Compound is spending big and hiring experienced people to win back trust. But as one expert warned, institutions "aren't underwriting teams, they're underwriting structures" — meaning credentials alone won't be enough. The company must prove its system is safe and reliable.

This is an AI-generated summary. Read the original article at: https://www.coindesk.com/business/2026/08/17/compound-bets-usd52-million-new-leadership-team-in-switch-to-institutional-focus