The prolonged governance dispute that began when Aave Labs diverted 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 crucial in Aave's history by its founder, establishes a framework where 100% of the revenue generated from all Aave-branded products is redirected 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 serves as a decentralized autonomous organization that oversees the Aave lending protocol, allowing token holders to make decisions on upgrades, fees, and treasury use.
The 'Aave Will Win' proposal marks a significant shift towards a fully token-centric model, where Aave becomes a singular asset with a unified model. This development resolves a controversy reported in December, where delegates discovered that the integration of CoWSwap into Aave's interface had quietly shifted swap-related fees away from the community treasury. The proposal decisively favors token holders, ensuring that protocol revenue, which reached $140 million in 2025, will be supplemented by application-layer revenue from various Aave products. The ambition lies in the application layer, with Aave App aiming to provide a 'fintech-like experience' for mainstream users, complete with $1 million account protection per user and a card that generates fees for the treasury.
The proposal also tackles 'value leakage' by ensuring that service providers build exclusively for Aave, with measurable goals and reduced governance process friction. Technically, Aave V4's reinvestment feature will turn idle float capital into yield-generating positions, while new 'Spokes' will expand collateral options and address DeFi liquidity demands. With roughly $25 billion in total value locked across multiple chains, Aave is poised to scale, with the target of reaching $1 trillion and positioning itself as a financial network that any fintech, bank, or asset manager can integrate into.