The Aave community has put an end to a months-long governance dispute by approving the 'Aave Will Win' proposal, a landmark framework that redirects all revenue from Aave-branded products back to the DAO and consolidates economic rights under the AAVE token. This significant shift means the DAO will now be responsible for funding Aave Labs' activities, with a $25 million stablecoin grant and 5,000 AAVE token allocation approved.
The proposal resolves a controversy that began when swap fees were redirected away from the community treasury, exposing a deeper tension over control of the protocol's user-facing products and revenue. The 'Aave Will Win' proposal decisively favors token holders, supplementing protocol revenue with application-layer revenue from Aave Pro, Aave App, Horizon, and Aave Kit.
With a hard line against 'value leakage,' service providers must build exclusively for Aave, with measurable goals and governance process improvements planned. The proposal also outlines technical developments, including Aave V4's reinvestment feature and new 'Spokes' to expand collateral options. Aave, the largest lending protocol in DeFi with $25 billion in total value locked, aims to scale from $40 billion to $1 trillion, positioning itself as a financial network for fintech, banks, and asset managers.