The prolonged governance battle, sparked by Aave Labs' redirection of 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, establishes a framework that channels 100% of revenue from 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 to Aave Labs.
The Aave DAO, a community-run decision-making body, manages the Aave lending protocol, enabling token holders to vote on key decisions such as upgrades, fees, and treasury use. The 'Aave Will Win' proposal marks a decisive victory for token holders, resolving the controversy that emerged in December when delegates discovered that swap-related fees had been quietly shifted away from the community treasury.
The proposal addresses the issue of 'value leakage' by requiring service providers to build exclusively for Aave, with measurable goals and zero tolerance for relationship gating or products built at the expense of token holders. On the technical front, Aave V4's reinvestment feature and new 'Spokes' are set to expand collateral options and address DeFi liquidity demand. With roughly $25 billion in total value locked across multiple chains, Aave aims to scale from $40 billion to $1 trillion, positioning itself as a financial network that any fintech, bank, or asset manager can integrate with.