A significant governance decision has been made, with the Aave community voting in favor of the 'Aave Will Win' proposal, a framework that redirects 100% of revenue from Aave-branded products back to the DAO, consolidating economic rights under the AAVE token. This move shifts the responsibility of funding Aave Labs' activities to the DAO, with a $25 million stablecoin grant and 5,000 AAVE token allocation approved. The Aave DAO, a community-run decision-making body, manages the Aave lending protocol, allowing token holders to vote on key decisions.
The 'Aave Will Win' proposal resolves a dispute that arose when delegates discovered that swap-related fees had been quietly diverted away from the community treasury. This controversy exposed a deeper tension over control of the protocol's valuable assets.
The proposal decisively favors token holders, supplementing protocol revenue with application-layer revenue from Aave Pro, Aave App, Horizon, and Aave Kit. The application layer is a key area of focus, with Aave App targeting mainstream users and generating fees for the treasury. The proposal takes a firm stance against 'value leakage,' requiring service providers to build exclusively for Aave. Technical improvements include Aave V4's reinvestment feature, which turns idle capital into yield-generating positions, and the introduction of 'Spokes' to expand collateral options.
Aave holds approximately $25 billion in total value locked, making it the largest lending protocol in DeFi, with a stated target of scaling to $1 trillion.