What is Compound finance? Complete Overview for 2026

Introduction to Compound finance

Compound finance represents one of the most innovative aspects of blockchain technology. It aims to recreate traditional financial services in a decentralized way.

For newcomers, Compound finance can seem overwhelming, but the core concepts are straightforward once you understand the basics.

How Compound finance Works

At its core, Compound finance relies on smart contracts — self-executing code on the blockchain that eliminates the need for intermediaries.

Understanding the mechanics of Compound finance helps you make informed decisions and avoid common pitfalls.

Getting Started with Compound finance

To begin exploring Compound finance, you will need a compatible wallet like MetaMask and some cryptocurrency for gas fees.

Start with small amounts as you learn how Compound finance works before committing larger sums.