# Compound Protocol Grants (CGP 2.0): Application Guide
*Based on real data from 126 applications (53 approved, 73 rejected)*
*Source: Questbook platform — "Compound dapps and protocol ideas (CGP 2.0)", March 2026*

## Program Overview

Compound Grants Program 2.0 (CGP 2.0) funds projects building dapps, tools, and protocol improvements for the Compound lending protocol on Ethereum. This is a DAO-governed grant program — reviewers are community members who stake their reputation on approvals.

## Key Statistics

| Metric | Value |
|--------|-------|
| Total Applications Analyzed | 126 |
| Approved | 53 |
| Rejected | 73 |
| Approval Rate | 42% |
| Rejection Rate | 58% |

## Budget Ranges (Approved Applications)

- Budget data not consistently structured in this program

## What CGP 2.0 Reviewers Look For

### 1. Direct Compound Protocol Integration
- **Deep integration**: Your project must meaningfully use Compound v2 or v3 (Comet)
- **Compound v3 focus**: CGP 2.0 prioritizes projects leveraging the newer Comet architecture
- **cToken / COMP mechanics**: Show you understand how cTokens, interest rates, and COMP distribution work
- **Protocol improvements**: Improvements to liquidation efficiency, interest rate models, risk parameters

### 2. DeFi Ecosystem Value
- **Composability**: How does your project compose with other DeFi protocols?
- **TVL impact**: Can your project increase Compound's TVL or usage?
- **Risk analysis**: DeFi projects must demonstrate awareness of smart contract and oracle risks
- **Audits**: For any contract work, include audit plans (or explain why not needed)

### 3. Technical Depth
- Solidity contract architecture
- Integration with Compound's Comet interface
- Testing strategy including forked mainnet tests
- Gas efficiency analysis

### 4. DAO Alignment
- Reference Compound Governance and how your project fits
- Compound community forum engagement shows seriousness
- COMP holder value — can you articulate how this benefits COMP holders?

### 5. Milestone-Based Delivery
- CGP 2.0 uses milestone-based payment — each milestone unlocks the next tranche
- Be very specific about what each milestone produces
- Include a "milestone 0" (planning/architecture) to demonstrate preparedness

## Common Rejection Patterns

- **Team credibility issues**: 30/73 (41%)
- **Weak milestone structure**: 22/73 (30%)
- **Out of ecosystem scope**: 12/73 (16%)
- **Budget unjustified**: 12/73 (16%)
- **Duplicate / existing solutions**: 11/73 (15%)

## Approved Proposal Examples

### Example 1: 0

**Description:**
0

---

### Example 2: 0

**Description:**
0

---

### Example 3: 0

**Description:**
0

## Application Checklist

- [ ] Clear explanation of which Compound version (v2 / v3 / Comet)
- [ ] Technical architecture showing Compound integration points
- [ ] Smart contract code snippets or pseudocode for core functions
- [ ] DeFi risk analysis (oracle risk, liquidation risk, smart contract risk)
- [ ] Audit plan or explanation of why audit is not needed
- [ ] Milestones with unlock criteria for each payment tranche
- [ ] Team with DeFi / Solidity experience
- [ ] Compound community forum link or prior engagement
- [ ] How project benefits COMP holders / increases Compound usage
- [ ] Post-grant maintenance plan (who maintains contracts?)

## Compound-Specific Tips

1. **Comet vs Compound v2**: CGP 2.0 strongly favors Compound v3 (Comet) — understand the Comet architecture before applying
2. **Risk parameters**: Show you understand how Compound manages collateral factors and liquidation incentives
3. **Governance**: Frame your project as something COMP holders would want to fund — write a short Compound governance forum post alongside your application
4. **Gas efficiency**: Compound is on Ethereum mainnet — gas costs matter enormously; show optimization
5. **Composability**: The best Compound grant projects are usable by other DeFi protocols — plan for that

## Resources

- Compound Developer Docs: https://docs.compound.finance
- Compound Governance Forum: https://www.comp.xyz
- Comet (v3): https://github.com/compound-finance/comet
- Questbook: https://questbook.app

*Data: AgentRel analysis of Questbook GraphQL API. 126 applications analyzed, March 2026.*