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Compound is a decentralized on-chain crypto financial market and lending network that creates asset pools with good interest rates based on the supply and demand of the assets.

The deposit and withdrawal procedures with Compound Lending are managed directly on the DeFi Wallet app due to Crypto.com’s DeFi Earn integration. This eliminates the need for you to deal with smart contract calls, clarifies the idea of cTokens, and shows the interest that has accrued over time.

How does Compound Lending work?

Compound’s key selling point is that it enables customers to earn interest on their cryptocurrency holdings without requiring them to be held in escrow by a third party.

When you transfer your tokens into the Compound Lending network using DeFi Earn, you are moving them to Compound’s smart contract. In return, you receive the equivalent cTokens in exchange, which reflects your claim to the lent assets.

Even if interest isn’t dispersed, merely keeping cTokens will earn you interest since they increase in value via their exchange rate over time. This happens even while the total quantity of cTokens in your wallet remains unchanged. Therefore, when you try to transfer your cTokens, Crypto.com shows an additional warning to make sure you grasp the implications of transferring your claim to lent assets plus the accumulated interest.

To redeem your invested assets and the interest that has accumulated based on the cToken base token rate of exchange, you must send cTokens to Compound.

How to deposit your crypto asset to compound lending via DeFi earn

To deposit your crypto asset on DeFi earn to compound learning:

  • In the DeFi Wallet app, select “Earn” from the bottom menu.
  • Click “Earn More” to get a list of the tokens that are supported for earning.

To check the predicted yearly earning based on the most recent APY percent;

  • Select your favorite token 
  • Choose the Compound protocol on the “Choose Protocol” tab
  • Input the deposit amount.
  • Press Confirm Deposit to review and confirm the deposit.
  • Use your passcode to approve the deposit request (and 2FA if enabled).
  • Wait for the on-chain confirmation of your deposit request.
  • Upon confirmation, your DeFi Earn screen will display the updated total assets amount.

Additionally, you can view the projected APY percent by tokens on the DeFi Earn main screen. The tokens you deposit into DeFi Earn will be connected to the protocols in which you invested, allowing you to earn income at the moment of deposit. Once the deposit is validated on-chain, your invested asset will begin to earn interest.

How to view your compound lending earnings

To see your whole DeFi Earn assets in fiat equivalents; 

  • Go to the DeFi Earn and choose “Total Fiat Amount.”
  • Switch from “Total Fiat Amount” to “Total Crypto Amount” to see your DeFi Earn assets in cryptocurrency.
  • To examine your projected earnings, tap “Total Crypto Amount” and then “Earnings.”

How to withdraw your Compound lending earnings

The deposit on compound lending has no lockup restriction, and you may withdraw your cryptocurrency at any time using DeFi Earn or using your wallet balance. The processes to withdraw your cryptocurrency from DeFi Earn are as follows:

  • Go to the “DeFi Earn” tab at the bottom of the home screen.
  • Choose the token you wish to withdraw from the “Assets” section.
  • Select the “Withdraw” button.

To withdraw your earnings through your wallet balance:

  1. Go to the home screen and choose “DeFi Earn Assets.”
  2. On the screen for assets, choose the token.
  3. When you get to the screen showing your wallet’s balance, select “View Earnings.”
  4. On the DeFi Earn Details screen, select the “Withdraw” button.

What fees are attached to compound lending on DeFi earn?

For each withdrawal through Compound Lending, Crypto.com levies a 0.5 percent service fee on the related profits. The payment is intended to cover additional operational costs and risks related to running DeFi services and delivering new DeFi initiatives.

It should be noted that Compound Lending is an Ethereum-based protocol and that a network fee in ETH is charged for each request for a deposit or withdrawal.

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