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The developer of the decentralized lending platform Aave, Aave Chan Initiative, has announced its exit from the ecosystem by July. This marks the second significant departure in recent days linked to governance disputes within Aave: at the end of February, the developer company BGD Labs also announced its cessation of collaboration with the crypto platform.
ACI founder Marc Zeller stated that the company will not renew its agreement with Aave and will conclude its operations within four months. During this time, ACI will continue to participate in governance but will focus on transitioning infrastructure. Zeller noted that the decision was influenced by the departure of BGD Labs.
Disagreements among Aave participants began in December due to fees from the new integration of CoW Swap, with revenues benefiting the parent company Aave Labs rather than the community treasury. This decision was neither approved through voting nor officially announced, leading to dissatisfaction among AAVE holders who grew concerned that other financial initiatives might be decided without investor input.
BGD Labs proposed transferring control of Aave’s brand assets, including domains, trademarks, and social media accounts, to the token holder community to prevent future instances of revenue redistribution. Aave Labs brought the matter to a vote on Snapshot, but the proposal was not accepted due to a high number of abstentions. Aave founder Stani Kulechov opposed the idea.
In January, Kulechov suggested a partial distribution of revenues from non-protocol products. The proposal aimed to redirect 100% of revenues from Aave-branded products to the community treasury in exchange for approximately $51 million in funding to support the development of the fourth version of the blockchain. The idea was put to a vote and received support from 52.58% of voters.
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According to Zeller, Kulechov’s proposal was accepted, as around 233,000 AAVE are linked to the wallets of the parent company, with 111,000 tokens owned by Kulechov himself.
“The voting demonstrated that one organization holds sufficient power to advance its proposals against the community’s opinion. This same power can revoke existing funding streams at any moment. ACI believes the governance process is not sufficiently decentralized to ensure commitments are upheld,” Zeller stated to The Block.
Amid these developments, BGD Labs, which was the developer of the current third version of the protocol, announced its exit from collaboration. The company also disagreed with the dominant role of Aave Labs in the development of the fourth version of the blockchain, arguing that it poses a risk to collective governance.
Aave Chan Initiative and BGD Labs are companies that are significant holders of governance tokens and also developers of programs and updates for the Aave architecture, including those pertaining to the platform’s community decisions.
Previously, Kulechov stated that the platform would focus on developing the real asset market Horizon by 2026.
