{"id":138375,"date":"2020-07-05T14:00:07","date_gmt":"2020-07-05T13:00:07","guid":{"rendered":"https:\/\/cryptoslate.com\/?p=138375"},"modified":"2020-07-06T03:06:12","modified_gmt":"2020-07-06T02:06:12","slug":"defis-compound-comp-has-crashed-50-in-two-weeks-and-it-may-drop-further","status":"publish","type":"post","link":"https:\/\/cryptoslate.com\/defis-compound-comp-has-crashed-50-in-two-weeks-and-it-may-drop-further\/","title":{"rendered":"DeFi’s Compound (COMP) has crashed 50% in two weeks\u2014and it may drop further"},"content":{"rendered":"

When Ethereum-based finance protocol Compound<\/a> launched its native token COMP in June, it traded at $30. But due to an influx of hype which was somewhat a byproduct of market illiquidity, the altcoin shot over 1,000 percent higher, reaching an all-time high price in excess of $350.<\/p>\n

Unfortunately for those who bought the COMP<\/a> at the highs, the decentralized finance-centric ERC-20 token has since been subject to a steep retracement.<\/p>\n

According to CryptoSlate coin data<\/a>, the cryptocurrency now trades for $185 as of this article's writing. That is approximately 50 percent lower than COMP's all-time high \u2014 and that loss has been realized just in two weeks.<\/p>\n

A large portion of these losses was incurred following the altcoin's listing in Coinbase. Analysts have said that since Coinbase<\/a> was one of the first “mainstream” crypto exchanges to list COMP, that was the first venue through which many holders could sell their coins.<\/p>\n

Investors in the cryptocurrency, unfortunately, may be subject to further losses as analysts have claimed that the DeFi token may be intrinsically overvalued.<\/p>\n

The Ethereum-based Compound (COMP) is poised to collapse, analysts say<\/h2>\n

Even after its 50 percent decline from the highs, Compound is still a massive cryptocurrency. CryptoSlate's crypto leaderboard shows<\/a> that the asset is the 28th largest digital asset in circulation<\/a> \u2014 despite it being established in March and publicly launched in June.<\/p>\n

According to a new analysis<\/a> by trader “Theta Seek,” who has closely tracked the DeFi boom, COMP may have further to fall. He released<\/a> an extensive thread on his thoughts about the altcoin on Jul. 2nd.<\/p>\n

The premise of the thread was that he's publicly short on COMP<\/a>, writing that the “fundamentals of [Compound's] ‘governance', given the public information, don't make too much sense today.” Theta added that he wouldn't be surprised to see another 50 percent decline to take the cryptocurrency below $100.<\/p>\n

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1\/ I'm short on $COMP<\/a>, the fundamentals of the 'governance', given the public information, don't make too much sense today. <\/p>\n

Won't be surprised to see it fall below $100 unless a revenue model is proposed soon. – Read full thread..<\/p>\n

— Theta Seek (@thetaseek) July 2, 2020<\/a><\/p><\/blockquote>\n