- Aave DAO rejected a proposal to formally request that Aave Labs relinquish ownership of certain “brand assets.”
- Aave’s founder said the vote had raised “important questions” about the relationship between Aave Labs and AAVE tokenholders.
- An influential member of the DAO suggested another vote could come after the holiday season.
Critics of the company behind popular DeFi protocol Aave were dealt a blow on Christmas Day, as the DAO that governs the protocol rejected a proposal to formally request the company relinquish ownership of certain “brand assets.”
The vote concluded a heated row between Aave Labs, the company that built the first version of the Aave protocol, and the Aave DAO, the cooperative that now controls it.
But the detente might be short-lived — Marc Zeller, one of the most influential members within the cooperative, suggested another vote could come after the holiday season.
Aave enables peer-to-peer lending and borrowing on Ethereum and several other blockchains. It is the largest protocol in decentralised finance, with more than $33 billion in user deposits, according to DefiLlama data.
The controversy began earlier this month, when Aave Labs was accused of attempting to profit at the DAO’s expense. The company had decided to keep certain revenue generated by app.aave.com, the website through which most users access the Aave protocol. Previously, that revenue had been directed to the Aave DAO.
That website was created and owned by Aave Labs. Still, critics called it an unacceptable attempt to profit off the Aave brand, which underwent a DAO-funded visual overhaul this year.
The furore culminated with a proposal from software engineer and Aave contributor Ernesto Boado. He wanted the DAO to request that Labs transfer “brand assets,” such as naming rights, social media accounts, and the aave.com domain name, to the DAO, the cooperative that governs the protocol.
It became one of the 10 most commented-on proposals in the DAO’s history.
But it became controversial in its own right on December 21, when Labs put it up for a vote — without consulting Boado.
Stani Kulechov, the protocol’s founder and the CEO of Aave Labs, said the discussion has been extensive and token holders should be ready to vote. But critics saw an attempt to rush the issue through the Christmas holidays, when many DAO members would be unwilling or unable to cast a vote.
Boado called the push for a vote “disgraceful” and urged DAO members to cast an “abstain” vote to convey their displeasure — the DAO equivalent of voting for a write-in candidate.
According to a final tally, 55% of votes cast had been in opposition to the proposal. Another 41% were “abstain,” votes, and just 3.5% were in favour.
Kulechov noted the vote had raised “important questions” about the relationship between Aave Labs and AAVE tokenholders.
“I am committed to making the economic alignment between Aave Labs and $AAVE token holders more clear,” he wrote in the DAO’s governance forum after the vote ended.
“In the future, we’ll be more explicit about how products built by Aave Labs create value for the DAO and $AAVE token holders.”
Zeller, one of Labs’ harshest critics in recent weeks, celebrated the outcome as a moral victory for decentralised governance.
“Despite an unfair timeline and every practical disadvantage stacked against the DAO, participation broke records,” Zeller wrote in the forum. “That is not a defeat for decentralisation. It is the opposite of apathy, and that is exactly what a healthy DAO should look like.”
And he hinted another vote could be coming soon.
“When a mature, legitimate vote is re-run with the author’s consent and a complete discussion cycle, participation should be even higher,” he wrote.
Aave token was trading just under $155 on Friday afternoon, a 22% decrease since the controversy first erupted earlier this month.
Aleks Gilbert is DL News’ New York-based DeFi correspondent. You can reach him at aleks@dlnews.com.
