'Aave will win' proposal clears temp check with 52.6% backing on revenue shift, V4 plan

Aave governance participants have advanced a proposal outlining a structural shift in the protocol’s operating model that would reroute all revenue from the Aave-branded products to the DAO treasury while aligning future development around the upcoming V4 upgrade.

The "Aave Will Win" temp check secured about 622,300 YAE votes, or 52.58%, according to governance results. NAY votes totaled 497,100, or 42%, while 64,200 votes, or 5.42%, abstained. The vote was created on Feb. 25, opened Feb. 26 and concluded early Sunday.

If carried through subsequent stages, the framework would establish four operational pillars: directing 100% of Aave-branded product revenue to the DAO, establishing a formal brand protection mechanism, ratifying Aave V4 as the core technical foundation, and creating a framework for the DAO to fund strategic growth initiatives.

The temp check serves as an initial signal of community support. A formal ARFC submission incorporating feedback is expected as the next step in the governance process.

Revenue capture, technical transition

Under the framework, 100% of gross product revenue earned by Aave Labs, net of direct revenue sharing and incentives paid to external partners, would flow to the DAO treasury.

Products listed in the proposal include aave.com and its associated fees, the Aave App mobile application, Aave Card, Aave Pro, Aave Kit for enterprise integrations, Aave Horizon for real-world asset and institutional services, and a proposed AAVE exchange-traded product. 

The DAO would also receive revenue from the swap integration on aave.com, which currently generates approximately $10 million in annualized revenue, with planned expansion to additional chains and functionality, according to the proposal. 

The proposal also seeks to ratify Aave V4 as the protocol's primary technology layer. While Aave V3 currently generates more than $100 million in annualized revenue, the proposal outlines a transition plan where V3 enters "stable maintenance" once V4 is mature. 

This transition is designed to occur in three phases — active development, stable maintenance, and legacy support — ensuring V3 remains open for withdrawals, with parameters gradually adjusted to encourage migration to the V4 architecture.

Brand governance, funding request

Aave Labs, the current exclusive legal owner of the Aave trademarks, proposed the creation of a Foundation to assume responsibility for brand governance. Since the DAO is not a legal entity, it cannot directly hold trademarks. The proposed Foundation would instead license the brand to approved entities and address unauthorized use in alignment with DAO parameters. 

This shift accompanies a plan to expand market access for the AAVE token through regulated traditional market products, including futures and a spot exchange-traded product.

Meanwhile, the funding request presented by Aave Labs involves a primary grant of $25 million in stablecoins and 75,000 AAVE. The stablecoin portion consists of $5 million upfront and $20 million streamed over one year, while the 75,000 AAVE will unlock linearly over 24 months.

Additionally, the proposal includes milestone-based growth grants of $5 million each for the launch of the Aave App, Aave Pro, and Aave Card, and $2.5 million for the Aave Kit launch.

The motivation for this structural overhaul, according to the proposal, is the requirement to match the resource allocation of competing fintechs and banks as institutions move onchain. Aave Labs noted that by directing all product revenue to the treasury, the entity can no longer self-fund the product engineering, legal defense, and business development operations it has maintained since 2017.

The temp check, however, drew criticism from some community members regarding the voting dynamics and the proposal's terms. In a post on the governance dashboard, one participant questioned whether token holders were free to vote independently across proposals involving Aave Labs and other service providers.

Marc Zeller, founder of the Aave Chan Initiative, later published a post-mortem analysis of the results, alleging that the proposal only passed due to votes cast by addresses he described as linked to Aave Labs.

Zeller argued that if approximately 233,000 AAVE from three specific "Labs-linked" clusters — including a 111,000 AAVE delegation from founder Stani Kulechov — were excluded, the result would have flipped to 497,100 NAY versus roughly 387,000 YAE.

The article has been updated with feedback from Aave community members.