Aave Labs is considering a proposal to share revenue with AAVE token holders generated from new businesses built outside the core Aave protocol. While Aave Labs is putting forward the idea, the Aave DAO remains the governing body of the protocol.
However, some AAVE holders are unhappy, arguing that Aave Labs holds more control than the DAO. Past governance votes rejected giving the DAO full ownership of Aave’s brand assets, and fees from CoW Swap integrations were reportedly routed to private Aave Labs wallets, not the DAO. Community members such as Marc Zeller and BrazenSeeker have raised concerns, warning that these moves could lead to quiet privatization of parts of the Aave ecosystem.
Aave’s Expansion Plans Spark Governance and Revenue Debate
The Critics inside the AAVE community are that some of the DAO members and long-term token holders are asking for 100% control and clarity over the money and power flow in the ecosystem. They demand this 100% control because the AAVE token holders own and govern the protocol, and they say that the Revenue should reward those who take the governance risk. Instead of asking for the money, they first ask for clarity and rules on Brand usage, Asset Ownership, and Revenue flow.
AAVE mainly focuses on Crypto lending, and the AAVE team believes that AAVE can grow bigger. The AAVE wants to expand into real-world assets and attract more users and developers. This creates AAVE as a new revenue source. The AAVE V4 is the major reason for this plan because it introduces the modular architecture and allows use cases without risking the Core protocol. It also supports RWA-backed loans and custodian-based lending, which makes it easier for the developer to innovate safely.
On the other hand, the AAVE labs clearly say that AAVE needs to grow beyond the Crypto lending and not all the revenue comes directly from the Protocol, and they are proposing to share some of these revenues with the AAVE Holders through governance as a compromise. The AAVE Labs believes that 100% DAO control over everything would slow the execution, and the company-led structure helps move faster and compete.
This news impacted the price of AAVE to move upwards as the community got the potential benefits that could help the holders. AAVE is currently trading at the price of $161.90 with 6.60% increase in 24 hours and an 8.48% increase in the past 5 days.
Highlighted Crypto News:
BlackRock Clients Add 3,199 BTC in Fresh Institutional Buying
