Case summary
What happened
On 2020-11-26, an abrupt DAI price increase on Coinbase Pro triggered approximately 85.2 million DAI of liquidations in Compound's DAI market. On 2021-09-29, a bug introduced through Proposal 62 allowed excessive COMP reward claims, prompting emergency governance patches and temporary restrictions on affected COMP claims. On 2022-08-30, a cETH price-feed upgrade caused a temporary denial of service that effectively froze cETH withdrawals and liquidations until Proposal 119 restored the prior oracle path. Compound continued operating and maintains active lending markets in 2026.
Customer result
Customer outcome
Unknown
The reviewed governance sources document proposed and implemented fixes for protocol mechanics but do not establish one universal customer-outcome percentage across the 2020 liquidation event, the 2021 COMP distribution bug and the 2022 cETH availability incident. CYA therefore leaves aggregate customer outcome unknown rather than inferring compensation or recovery.
- Estimated recovery
- Unknown
- Repayment started
- —
- Repayment completed
- —
- Confidence
- High
Asset treatment
Terms risk
Customer-owned
Compound is modeled as non-custodial DeFi lending rather than a platform-owned account balance. Historical incidents demonstrate that non-custodial architecture does not remove oracle, governance-upgrade, liquidation, reward-accounting or market-availability risk.
- Affected product
- —
- Confidence
- High
Known unknowns
Uncertainty
The reviewed incidents have different economic meanings: 2020 liquidations are not equivalent to protocol bad debt, 2021 excess COMP distribution is not customer-principal loss, and the 2022 cETH incident was a temporary market-specific availability failure. CYA does not infer a universal compensation or recovery percentage across them.
Chronology
Historical record
Compound DAI market experiences approximately 85.2 million DAI of liquidations
An unexpected increase in the DAI price on Coinbase Pro triggered large liquidations in Compound's DAI market. Later Compound governance discussion quantified approximately 85.2 million DAI of liquidations and considered, but did not automatically establish, compensation for affected accounts.
The 85.2 million DAI figure is a liquidation volume cited in Compound governance discussion, not a universal final loss, protocol bad-debt figure, or realized compensation amount.
Compound Proposal 62 bug enables excessive COMP reward claims
A bug introduced through Compound governance Proposal 62 caused incorrect COMP reward accounting and enabled certain users to claim excessive COMP. Compound governance subsequently prepared and executed patches, including Proposal 64, and temporarily restricted COMP claims for potentially affected users while correcting accrual state.
Community analysis later described roughly USD 50 million worth of COMP as lost through the exploit. This is treasury/reward-token loss and is not modeled as a universal customer-principal loss figure.
Compound cETH price-feed incident temporarily freezes withdrawals and liquidations
A cETH price-feed upgrade introduced an invalid price path that effectively froze withdrawals and liquidations in the cETH market. Compound V2 markets other than cETH and Compound III remained functional. Proposal 119 reverted the problematic upgrade and restored cETH price feeds on 2022-09-07.
The incident was a temporary market-specific denial of service and is not treated as protocol-wide shutdown or evidence of universal user loss.
Source record
Evidence dossier
Filter by claim, reliability, source type, and whether evidence is linked to a specific event.
Event
5 sourcesPROPOSAL: Distribute DAI to Users Affected by DAI Liquidations
Compound Community Forum · 2021-08-09
Compound governance discussion documenting the November 26, 2020 DAI liquidation event and approximately 85.2 million DAI liquidated.
Compound Proposal 63: Temporary Patch for COMP Distribution Bug
Compound Community Forum · 2021-09-30
Documents the COMP distribution bug response, temporary UI claim restrictions and planned governance patches.
Analysis of Proposal 64
Compound Community Forum · 2021-10-04
Explains that Proposal 64 patched the bug introduced in Proposal 62 and restricted claims for accounts potentially affected by incorrect accrual.
Auditing Compound Protocol
Compound Community Forum · 2021-11-03
Contemporaneous governance discussion describing roughly USD 50 million worth of COMP lost and identifying proposal-review process failure.
cETH Price Feed Incident: Post-Mortem
Compound Community Forum
Compound post-mortem describing the cETH price-feed failure, temporary freeze and restoration through Proposal 119.
status
2 sourcesCompound Markets
Compound
Current Compound application exposing active lending-market interfaces.
Financial Update
Compound Foundation
2026 Compound Foundation update describing protocol stabilization and ongoing operations.
No evidence records match the current filters.
Comparative records