Compound Labs has submitted applications for an Ethereum-based government bond Fund

Compound Labs has applied for a fund called ‘Superstates’ which is an Ethereum-based sovereign bond fund, prompting its administrators to take action.

Compound Labs has submitted applications For an Ethereum-Based Government Bond fund

It clearly states that it does not directly or indirectly invest in Superstates, blockchain technology, or cryptocurrencies. Instead, it utilizes blockchain technology to respectfully maintain a secondary record of specific shareholders’ stakes in one or more blockchains, such as the Ethereum Blockchain.

Compound Labs to Use Ethereum for Record Keeping

There is no information available regarding the minimum purchase or minimum investment. Among the portfolio managers are Robert Leshner, the founder and CEO of Compound, and Jim Hiltner, the Sales President of Compound.

Regarding the use of the blockchain for the bond, the filing reads,

The adviser believes that a blockchain-integrated recordkeeping system may provide operational efficiencies and enhance shareholder experience without negatively impacting the quality of the services provided by the fund’s transfer agent. In the future, the fund’s shares may also be available for purchase, sale, or transfer from one shareholder to another shareholder (or potential shareholder) ‘peer-to-peer’ on a blockchain by utilizing Secondary Blockchain Records.

Robert Leshner

Compound Labs has been busy making significant technical advancements in the past 12 months. In August 2022, they established smart contracts for the USDC market on Ethereum.

DeFi Platforms are Shifting Toward Traditional Finance (TradFi) Models

Other DeFi participants have been increasing their interest in TradFi for quite some time. MakerDAO made headlines in the fourth quarter of 2022 when it invested $500 million in US government bonds. In early June 2023, they entered a voting process to add an additional $1.28 billion to this bond purchase.

The treasury bonds currently amount to a total of $1.2 billion in the DAI stablecoin reserves. This acquisition is being carried out as part of founder Rune Christensen’s “Endgame Plan.

About Compound Labs

Compound Labs, Inc. designs and develops software. The Company offers a web interface that algorithmically adjusts money market interest rates based on asset-specific supply and demand.