Instead, a new staking product will be introduced that CompoundDAO will control, with the support of a broader group of COMP holders. This change was met with a positive reaction in the markets, with the value of the COMP token increasing by 5.6% to $51.27.

The GoldCOMP proposal has been a major topic of discussion in the Compound ecosystem. This proposal aimed to create a yield-bearing protocol using Compound’s native token, COMP.

Critics claimed that this proposal was a management attack and stated that it carried the risk of centralization, vote manipulation and mismanagement of the treasury. Major stakeholders, especially Wintermute, were concerned about the content of the proposal and the way it was implemented.

The goal of the GoldCOMP proposal was to establish a protocol that would generate passive income by allocating $24 million worth of COMP tokens through the DAO. However, this proposal was met with great opposition and many key stakeholders feared administrative problems if this plan was implemented.

There was also concern that the proposal’s supporters, Humpy and the Golden Boys, would become overly controlling. This made centralization and the seizure of control by a minority group a particular concern.

With the new agreement, Humpy and the group agreed on a counter-proposal to create a staking product instead of goldCOMP, where existing and new market reserves would be distributed proportionally to staked COMP holders annually. This new staking product will be controlled by Compound DAO.

This will directly address many people’s concerns over Humpy and the Golden Boys’ control. It will also be audited by Compound-appointed security partners and continually reviewed by the DAO’s Market Risk Manager.

Detailed information has been provided on how the new staking product will work. This product will allow 30% of staked COMP tokens to be distributed annually from existing and new market reserves.

Thus, COMP holders will be able to receive annual returns in proportion to the amount they stake. While this system provides returns to staking users, it also aims to increase the sustainability of the system.

Humpy’s withdrawal of the goldCOMP proposal caused the markets to welcome this new approach. Humpy was late in withdrawing Proposition 289, which was initially proposed for goldCOMP, but stated on the forums that he “fully approves” of the idea. This withdrawal increased confidence in the markets and was reflected in the increase in the value of the COMP token.

As a result, the cancellation of goldCOMP and the introduction of the new staking product reshaped the governance dynamics in the Compound ecosystem. Investors believe that following these changes, they will see greater transparency and more balanced governance in the Compound ecosystem.

Such regulations are considered important steps to establish trust and ensure sustainability in the crypto world.