The prolonged governance battle that began when Aave Labs redirected swap fees away from the DAO treasury has come to an end, with the community voting in favor of the Aave Will Win proposal. This proposal, deemed the most significant in Aave's history by founder Stani Kulechov, establishes a framework that redirects 100% of revenue from all Aave-branded products back to the DAO, consolidating economic rights under the AAVE token. As a result, the DAO will now be responsible for funding Aave Labs' activities, with the proposal approving a $25 million stablecoin grant and a 5,000 AAVE token allocation, valued at approximately $6.8 million, to Aave Labs.
The Aave DAO, a community-run decision-making body, manages the Aave lending protocol and allows token holders to vote on key decisions such as upgrades, fees, and treasury use. The Aave Will Win proposal marks a significant shift towards a fully token-centric model, where one asset, the AAVE token, drives the protocol. This move resolves a dispute that surfaced in December when delegates discovered that the integration of CoWSwap into Aave's interface had quietly shifted swap-related fees away from the community treasury. The controversy highlighted a deeper tension between Aave Labs and the DAO over control of the protocol's most valuable assets: user-facing products and the revenue they generate.
The Aave Will Win proposal decisively favors token holders, with protocol revenue, which reached $140 million in 2025 and is expected to match that in 2026, now being supplemented by application-layer revenue from Aave Pro, Aave App, Horizon, and Aave Kit. Swaps on Aave.com and Aave Pro are already generating an additional $10 to $20 million in revenue beyond existing protocol fees.
The application layer is a key area of focus, with Aave App aiming to provide a mainstream user experience with $1 million account protection per user and a card that will generate fees for the treasury. The proposal takes a strong stance against value leakage, mandating that service providers build exclusively for Aave, with no tolerance for relationship gating or products built at the expense of token holders. Service providers will have measurable goals, and governance process improvements are planned to reduce politics and friction.
Technically, Aave V4's reinvestment feature will turn idle float capital in lending pools into yield-generating positions, creating an additional revenue stream. New Spokes will expand collateral options and address the demand side of DeFi liquidity, while the team plans to invest in agentic AI infrastructure for developers building on Aave. With roughly $25 billion in total value locked across multiple chains, Aave is the largest lending protocol in DeFi, and its $140 million annual revenue puts it alongside Uniswap and Lido as one of the few protocols generating nine-figure income. Kulechov's target is to scale from $40 billion to $1 trillion, positioning Aave as a financial network that any fintech, bank, or asset manager can plug into, rather than a traditional bank.