As a reddit user pointed out on June 20 in this post, someone borrowed over $2.4 million in BAT using compound.finance thus driving up the APY for BAT. It seemed like others followed borrowing even more, driving the APY to over 30% in a couple of hours. Right now at the time of writing the supply APY is sitting at a solid 22.4% at nearly $40 million borrowed.
As some other reddit users pointed out in the comments, this is intentional and a way of "farming" COMP Tokens. They refer to a Twitter post of Instadapp, saying that they actually added BAT support for COMP mining. They're encouraging users of their app to "Create BAT lent & borrowed, both positions on our portal to SUPER maximize".
You can see on the Compound App that this all happened in the cause of one day.
If you don't know what compound is, it's basically a decentralized crypto lending platform in the form of "a decentralized protocol which establishes money markets with algorithmically set interest rates based on supply and demand" for Ethereum assets. The COMP token has become the largest Defi token very quickly and is to be listed on Coinbase this month.
If it's a good idea to throw your BAT into Instadapp or the compound app directly? I don't know and i'm not educated enough on the matter, but these interest rates sure sound pretty interesting.
For the time being i don't really have a lot of BAT to spare to try it out. But if it stays at this level i guess i'll try it next month.
If you by any chance haven't heard of and don't use Brave Browser feel free to get it from my link. I'll get a bonus and you can earn BAT too through the Brave Rewards System too.
This is not by any means financial advise.
