Today S&P Global Ratings gave Compound Prime a ‘B-‘ rating with a stable outlook. A B- would be regarded as a ‘junk’ rating for a conventional security and about six notches below investment grade.
While Compound Labs is known for creating the Compound DeFi crypto lending protocol, the rating is for Compound Prime LLC which offers a centralized service to accredited investors that earn 4%. It currently has just $85 million in deposits compared to the more than $6.5 billion on the DeFi protocol.
Compound Prime’s “Compound Treasury” account enables organizations that are not crypto-savvy to wire money in the conventional way, earn the fixed 4% interest rate with no fixed term, and give 24-hours notice of withdrawal. The depositor doesn’t engage directly with cryptocurrency or wallets. Behind the scenes, the wired money is converted into the USDC stablecoin and lent out on the Compound Protocol.
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