Huma Finance vs Compound: Who Comes Out on Top? @Huma Finance 🟣
1. Positioning and Business Model
• #HumaFinance : Focuses on the PayFi (Payment Finance) track, providing liquidity through tokenizing cross-border payment receivables. Its core business includes instant credit card settlement and short-term trade financing, with annualized returns of 10%-12.5%, and the returns come from real economic activities (such as payment fees).
• Compound: A traditional DeFi lending protocol where users deposit assets to earn interest. Returns depend on market supply and demand, currently around 3%-5% annualized for USDC, significantly affected by cryptocurrency market fluctuations.
2. Comparison of Returns and Risks
• Return Stability: Huma's returns are supported by real payment businesses, making them more sustainable; Compound's interest rates fluctuate with the market, potentially approaching zero in a bear market.
• Risk Control: Huma only partners with licensed financial institutions, uses SPVs to isolate funds, and has short asset maturities (1-6 days); Compound relies on over-collateralization but faces liquidation risks and smart contract vulnerabilities.
3. Technological Innovation and Compliance
• $HUMA : Based on the Solana high-performance chain, integrates Scroll's ZK-Rollup to enhance transparency and complies with Swiss regulatory requirements.
• Compound: Relies on the Ethereum ecosystem, has weaker compliance, and is not explicitly included in traditional financial regulatory frameworks.
Summary: If pursuing stable returns linked to real-world businesses, Huma is the better choice; if preferring a flexible lending market, Compound remains a classic option. The two represent the two major directions of DeFi: "Real-World Asset Anchoring" and "Pure On-Chain Native."