Compound Labs launches Encumber mechanism to separate token ownership and transfer rights

Compound Labs introduces the Encumber mechanism, a mechanism that allows users to separate token ownership from transfer rights. When a token owner stakes their tokens to another account, it is allowed to grant that account the exclusive right to transfer tokens while retaining ownership. This enables token holders to commit to the terms in a smart contract without transferring ownership of their tokens to an external address. By using Encumber, token holders can retain airdrops, governance rights, or access to content and events while still participating in DeFi.