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The proposal comes amidst disagreements within the Aave community regarding control over the protocol’s branding and essential assets.
What to know:
- Aave Labs has proposed a new governance initiative that aims to define the upcoming phase of one of the largest lending platforms in the crypto space, directing all income from Aave-branded products to its community treasury.
- This initiative, named “Aave Will Win,” seeks the approval of the Aave DAO for a comprehensive strategy related to its upcoming V4 upgrade.
Aave Labs has proposed a new governance initiative that aims to define the upcoming phase of one of the largest lending platforms in the crypto space, directing all income from Aave-branded products to its community treasury.
This initiative, named “Aave Will Win,” seeks the approval of the Aave DAO for a comprehensive strategy related to its upcoming V4 upgrade. If enacted, the strategy would establish V4 as the cornerstone for Aave’s future advancements and solidify a framework in which 100% of revenue from products developed by Aave Labs is allocated directly to the DAO.
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The AAVE token has seen an increase of approximately 2% following this announcement, despite a significant downturn in the broader crypto market on Thursday.
In essence, this implies that any revenue generated from Aave-branded applications, institutional offerings, or enterprise solutions would revert to the community-managed treasury instead of the development firm.
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“The framework formalizes Aave Labs’ role as a long-term contributor to the Aave DAO under a token-centric model, with 100% of product revenue directed to the DAO,” stated Stani Kulechov, Founder of Aave Labs, in a press release distributed to CoinDesk. “As on-chain finance enters a pivotal new stage, with fintechs and institutions entering DeFi, this framework positions Aave to seize significant growth markets and succeed over the next decade.”
The proposal emerges against a backdrop of discord within the Aave community regarding control over the protocol’s branding and vital assets. In late 2025, community members became sharply divided over whether the DAO or Aave Labs should govern trademarks, domains, social accounts, and other branded resources, with critics contending that centralized control by Labs could undermine the principles of decentralization. This conflict underscored broader tensions regarding the extent of influence founding teams should maintain once a protocol transitions to decentralization.
Aave is already one of the largest decentralized lending protocols in the crypto sector, facilitating users to borrow and lend digital assets without dependence on traditional banking systems. The new proposal aims to bolster the protocol’s competitiveness as more fintech companies and financial institutions venture into blockchain-based products.
Central to this strategy is Aave V4, a significant software enhancement designed to streamline the introduction of new markets and financial products on the protocol. Instead of necessitating substantial modifications to the core system each time a new feature is added, V4 aims to facilitate faster and more adaptable expansion while ensuring security.
The proposal also introduces the concept of launching distinct markets with varying risk and revenue frameworks. This could enable Aave to cater to specialized use cases, including institutional participation, without impacting the overall protocol.
A pivotal aspect of the framework is a transformation in how revenue is funneled to the DAO. Currently, Aave primarily generates income from lending activities. Under the new initiative, revenue from additional Aave Labs-developed products, such as user interfaces and institutional services related to the protocol, would also be channeled to the DAO treasury. The intention is to diversify revenue streams and align product development more closely with the interests of token holders.
The proposal further advocates for the establishment of a dedicated foundation to manage and safeguard Aave’s brand and trademarks, as decentralized organizations cannot directly hold intellectual property. More information regarding that structure will be presented in a subsequent vote.
If ratified, additional proposals will detail how V4 will be implemented and how funding will be organized. Collectively, the framework reflects Aave’s ambition to transition from a prominent DeFi lending protocol into a more expansive component of global financial infrastructure governed by its DAO.
Read more: ‘Most important tokenholder rights debate’: Aave faces identity crisis
