Coinbase, Exchanges

How Do You Use Compound on Coinbase?

If you’re looking to buy or sell cryptocurrencies on Coinbase, you may be wondering how to use the Coinbase compound function. Compound is an Ethereum-based protocol that allows users to earn interest on their deposited cryptocurrency.

In this article, we’ll show you how to use Compound on Coinbase and what you need to know before getting started.

To use Compound on Coinbase, you’ll first need to have a Coinbase account and an Ethereum wallet. Once you have those set up, you can deposit your cryptocurrency into your wallet and then head over to the Compound website.

At the Compound website, you’ll need to connect your wallet so that the site can access your deposited funds. Once your wallet is connected, you’ll be able to see all of the available cTokens that you can earn interest on.

Select the cToken that you want to invest in and then choose how much you want to deposit.

NOTE: WARNING: Coinbase requires a substantial investment in cryptocurrency to use their Compound feature. Investing in cryptocurrency is an inherently risky endeavor and can result in the loss of your entire investment. Before investing, you should diversify your portfolio, understand the market and research potential investments. Additionally, it is important to be aware of the risks associated with Compound on Coinbase, including but not limited to: flash crashes, illiquidity, and technical glitches. Always do your own research before investing and never risk more than you can afford to lose.

Once you’ve deposited your chosen amount, it will be converted into the corresponding cToken. For example, if you deposit 1 ETH, you’ll receive 1 cETH token.

These cTokens can then be traded on the Compound protocol for other cryptocurrencies or withdrawn back into your wallet.

To withdraw your earnings, simply head back over to the Compound website and select the “Withdraw” option. From there, you’ll be able to choose how much cToken you want to convert back into cryptocurrency and then send it back to your wallet.

Compounding is a great way to earn interest on your deposited cryptocurrency without having to do any work. It’s important to note, however, that there are risks involved in using any decentralized protocols like Compound.

Be sure to do your own research before getting started and only invest what you’re comfortable with losing.

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