**TL;DR**
Aave DAO is voting on a controversial proposal to transfer control of core brand assets (domains, social handles, GitHub repos, etc.) from Aave Labs to the DAO. Supporters see it as essential for true decentralization and revenue alignment; opponents argue it risks inefficiency and hurts innovation. The vote, rushed to Snapshot amid heated debate, has sparked accusations of bad faith, with $AAVE price dipping ~7-10% amid uncertainty. Voting ends December 25, 2025.
## Introduction
Aave, the leading DeFi lending protocol with over $50B+ TVL and ~60% market share in on-chain lending, faces an existential governance crisis. The proposal "[ARFC] $AAVE token alignment. Phase 1 – Ownership" ([Snapshot link](https://snapshot.org/#/s:aavedao.eth/proposal/0xbc606159ddeae0184c2086055637d3f357351ec0adc4c9f4150751bc41918eba)) seeks to shift explicit ownership of Aave's brand assets to the DAO via a neutral legal wrapper (e.g., a Cayman foundation).
Authored by Ernesto Boado (co-founder of BGD Labs and former Aave CTO), it was escalated to Snapshot on December 22, 2025, by Aave Labs despite objections from the author and some delegates. Voting runs until December 25, 2025.
## Proposal Details
- **Assets in Scope**: Domains (aave.com, app.aave.com), social handles, naming rights, GitHub organizations, NPM namespaces.
- **Goal**: Replace "implicit stewardship" by Aave Labs with DAO-controlled ownership, including anti-capture protections.
- **Rationale**: Prevent private monetization (e.g., frontend swap fees) and ensure value accrues to $AAVE holders.
- **Implementation**: Phase 1 is principle-only; Phase 2 will define legal structure.
Source: [Aave Governance Forum Thread](https://governance.aave.com/t/arfc-aave-token-alignment-phase-1-ownership/23616) and [Snapshot Proposal](https://snapshot.org/#/s:aavedao.eth/proposal/0xbc606159ddeae0184c2086055637d3f357351ec0adc4c9f4150751bc41918eba).
## Arguments in Favor
Supporters argue that token holders funded Aave via ICO and deserve explicit ownership.
> "Who owns AAVE? ... The token holders. Full stop."
> — Tor_GAINS, Snapshot discussion
Prominent voices like Jordan (former Aave COO) emphasize returning to the original vision:
> "This is the natural next step in Aave’s decentralization... especially now that DeFi benefits from far more regulatory clarity."
> — Jordan, Aave Governance Forum
Others highlight misalignment risks, such as CoW Swap integration diverting referral fees or Horizon market (a Labs-led product) allocating only 15% revenue to DAO.
## Arguments Against
Opponents, including Aave Labs founder Stani Kulechov, warn of operational paralysis.
> "The recent DAO alignment proposal has been moved to Snapshot after extensive discussion... Time for tokenholders to weigh in and vote."
> — Stani Kulechov (@StaniKulechov), X post (Dec 22, 2025)
Labs representatives argue the current model works, and DAO control introduces bureaucracy.
> "Is the path forward... for decentralized entities... to look and act more like centralized entities?"
> — setaavefree, Snapshot discussion
Critics also note timing issues (holiday season) and lack of consensus.
## Key Drama and Controversies
- **Rushed Escalation**: Author Ernesto Boado disavowed the Snapshot submission:
> "This is not, in ethos, my proposal... Trying to rush a vote is disgraceful."
> — Ernesto Boado (@eboadom), X post (Dec 22, 2025)
- **ACI Response**: Marc Zeller (Aave Chan Initiative) called it "unprecedented interference."
> "We acknowledge @aave unilaterally escalated the proposal... Worst outcome that was entirely preventable."
> — Marc Zeller (@Marczeller), X post (Dec 22, 2025)
- **Community Sentiment on X**: Polarized. Some accuse Labs of "stealth privatization"; others defend Labs' contributions. Recent X discussions highlight frustration over revenue sharing and governance process.
## Technical and DeFi Implications
This vote tests **DAO vs. founder-led hybrid models** in DeFi. Aave's success stems from Labs' rapid iteration (e.g., V3, GHO stablecoin at 350M+ supply, Horizon for RWA onboarding). However:
- **Revenue Split**: Protocol fees (~$100M+ annually) go to DAO; frontend/app monetization often benefits Labs.
- **Legal Challenges**: DAOs need wrappers (e.g., DUNAs, foundations) for IP ownership.
- **Precedents**: Echoes Uniswap's recent alignment shifts, but Aave's hybrid has driven dominance.
If passed, it could force Labs to license the brand or negotiate revenue shares. If rejected, it reinforces Labs' autonomy but risks further backlash.
## Current Market Impact
$AAVE trades around $160–$180 (as of Dec 22, 2025), down ~7–10% amid drama. Predictions vary: short-term bearish (Fear & Greed at Extreme Fear), but long-term bullish if resolved positively.
Sources: [CoinGecko](https://www.coingecko.com/en/coins/aave), [Bitget](https://www.bitget.com/price/aave/price-prediction), [CoinCodex](https://coincodex.com/crypto/aave-token/price-prediction/).
## Conclusion
This governance battle highlights DeFi's maturation pains: balancing decentralization with execution speed. Aave remains the lending king, but unresolved alignment risks eroding trust. Token holders decide December 25—will it reinforce DAO sovereignty or preserve Labs' operational edge? The outcome will shape not just Aave, but the future of founder-DAO relations in DeFi.
Aave DAO is voting on a controversial proposal to transfer control of core brand assets (domains, social handles, GitHub repos, etc.) from Aave Labs to the DAO. Supporters see it as essential for true decentralization and revenue alignment; opponents argue it risks inefficiency and hurts innovation. The vote, rushed to Snapshot amid heated debate, has sparked accusations of bad faith, with $AAVE price dipping ~7-10% amid uncertainty. Voting ends December 25, 2025.
## Introduction
Aave, the leading DeFi lending protocol with over $50B+ TVL and ~60% market share in on-chain lending, faces an existential governance crisis. The proposal "[ARFC] $AAVE token alignment. Phase 1 – Ownership" ([Snapshot link](https://snapshot.org/#/s:aavedao.eth/proposal/0xbc606159ddeae0184c2086055637d3f357351ec0adc4c9f4150751bc41918eba)) seeks to shift explicit ownership of Aave's brand assets to the DAO via a neutral legal wrapper (e.g., a Cayman foundation).
Authored by Ernesto Boado (co-founder of BGD Labs and former Aave CTO), it was escalated to Snapshot on December 22, 2025, by Aave Labs despite objections from the author and some delegates. Voting runs until December 25, 2025.
## Proposal Details
- **Assets in Scope**: Domains (aave.com, app.aave.com), social handles, naming rights, GitHub organizations, NPM namespaces.
- **Goal**: Replace "implicit stewardship" by Aave Labs with DAO-controlled ownership, including anti-capture protections.
- **Rationale**: Prevent private monetization (e.g., frontend swap fees) and ensure value accrues to $AAVE holders.
- **Implementation**: Phase 1 is principle-only; Phase 2 will define legal structure.
Source: [Aave Governance Forum Thread](https://governance.aave.com/t/arfc-aave-token-alignment-phase-1-ownership/23616) and [Snapshot Proposal](https://snapshot.org/#/s:aavedao.eth/proposal/0xbc606159ddeae0184c2086055637d3f357351ec0adc4c9f4150751bc41918eba).
## Arguments in Favor
Supporters argue that token holders funded Aave via ICO and deserve explicit ownership.
> "Who owns AAVE? ... The token holders. Full stop."
> — Tor_GAINS, Snapshot discussion
Prominent voices like Jordan (former Aave COO) emphasize returning to the original vision:
> "This is the natural next step in Aave’s decentralization... especially now that DeFi benefits from far more regulatory clarity."
> — Jordan, Aave Governance Forum
Others highlight misalignment risks, such as CoW Swap integration diverting referral fees or Horizon market (a Labs-led product) allocating only 15% revenue to DAO.
## Arguments Against
Opponents, including Aave Labs founder Stani Kulechov, warn of operational paralysis.
> "The recent DAO alignment proposal has been moved to Snapshot after extensive discussion... Time for tokenholders to weigh in and vote."
> — Stani Kulechov (@StaniKulechov), X post (Dec 22, 2025)
Labs representatives argue the current model works, and DAO control introduces bureaucracy.
> "Is the path forward... for decentralized entities... to look and act more like centralized entities?"
> — setaavefree, Snapshot discussion
Critics also note timing issues (holiday season) and lack of consensus.
## Key Drama and Controversies
- **Rushed Escalation**: Author Ernesto Boado disavowed the Snapshot submission:
> "This is not, in ethos, my proposal... Trying to rush a vote is disgraceful."
> — Ernesto Boado (@eboadom), X post (Dec 22, 2025)
- **ACI Response**: Marc Zeller (Aave Chan Initiative) called it "unprecedented interference."
> "We acknowledge @aave unilaterally escalated the proposal... Worst outcome that was entirely preventable."
> — Marc Zeller (@Marczeller), X post (Dec 22, 2025)
- **Community Sentiment on X**: Polarized. Some accuse Labs of "stealth privatization"; others defend Labs' contributions. Recent X discussions highlight frustration over revenue sharing and governance process.
## Technical and DeFi Implications
This vote tests **DAO vs. founder-led hybrid models** in DeFi. Aave's success stems from Labs' rapid iteration (e.g., V3, GHO stablecoin at 350M+ supply, Horizon for RWA onboarding). However:
- **Revenue Split**: Protocol fees (~$100M+ annually) go to DAO; frontend/app monetization often benefits Labs.
- **Legal Challenges**: DAOs need wrappers (e.g., DUNAs, foundations) for IP ownership.
- **Precedents**: Echoes Uniswap's recent alignment shifts, but Aave's hybrid has driven dominance.
If passed, it could force Labs to license the brand or negotiate revenue shares. If rejected, it reinforces Labs' autonomy but risks further backlash.
## Current Market Impact
$AAVE trades around $160–$180 (as of Dec 22, 2025), down ~7–10% amid drama. Predictions vary: short-term bearish (Fear & Greed at Extreme Fear), but long-term bullish if resolved positively.
Sources: [CoinGecko](https://www.coingecko.com/en/coins/aave), [Bitget](https://www.bitget.com/price/aave/price-prediction), [CoinCodex](https://coincodex.com/crypto/aave-token/price-prediction/).
## Conclusion
This governance battle highlights DeFi's maturation pains: balancing decentralization with execution speed. Aave remains the lending king, but unresolved alignment risks eroding trust. Token holders decide December 25—will it reinforce DAO sovereignty or preserve Labs' operational edge? The outcome will shape not just Aave, but the future of founder-DAO relations in DeFi.