Compound Treasury Receives S&P Credit Rating
Today, Compound Treasury received a
B- credit rating from S&P Global Ratings. This makes Compound Treasury the first institutional decentralized finance (DeFi) offering to be rated by a major credit rating agency, and signals tremendous progress in the crypto industry’s maturity, as traditional institutions begin to judge the risks of digital asset powered financial offerings.
S&P’s outlook is stable, reflecting an expectation of limited loan losses on the Compound Treasury platform. In assigning its rating and stable outlook, S&P cited the uncertain regulatory regime for stablecoins (USDC), stablecoin-to-fiat convertibility risks, Compound Treasury’s currently limited capital base and 4.00% return obligation; S&P views the Compound protocol (the source of yield for Compound Treasury) track record of zero USDC losses as partially mitigating the capital risks of the offering.
“Compound Treasury is predictable, liquid, compliant, transparent, and now rated,” said Reid Cuming, Compound Treasury General Manager, “S&P’s rating helps our institutional clients more easily understand the opportunity and risks of crypto-powered cash management”.
As part of ongoing discussions with S&P, Compound Treasury’s ratings could be upgraded in upside scenarios such as greater regulatory clarity for the digital asset industry, or a longer track record of stable performance.
Compound Treasury was supported throughout the credit rating evaluation process by Klaros Group, an advisory and investment firm, and Gauntlet, a financial modeling and simulation platform for blockchains.
Find Compound Treasury’s full ratings report at S&P Global Ratings Action Disclosures page.
About Compound Treasury
Compound Treasury is a crypto-powered cash management solution designed for institutions. Accredited investors can earn 4% on USD and USDC with daily liquidity; the easiest way for institutions to access the benefits of decentralized finance.
Compound Treasury is offered by Compound Prime, LLC, a subsidiary of Compound Labs, Inc.
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