Why this proposal matters, and what gets lost in the noise
Let me keep this grounded.
Aave is one of the very few DAOs that consistently produces real, recurring protocol revenue at scale. That engine did not run on autopilot. Over the past three years, it has been maintained, upgraded, protected, and expanded by an ecosystem of independent service providers, builders, delegates, voters, and contributors who show up every day to ship work, onboard strategic assets, curate risk, and keep the protocol safe and competitive.
If you want a simple mental model: the DAO is the engine, while brand assets and distribution channels are the storefront and the signage. The problem is not that private companies exist. Private companies should build products. The problem starts when one private actor has unilateral control over the storefront and signage, while the DAO ecosystem is the one keeping the engine running.
The historical context: Avara’s pivot
To understand why the DAO is the primary operational driver today, you have to look at the timeline.
Starting around late 2021 and through 2022, the entity formerly known as “Aave Companies” rebranded to Avara, a neutral corporate name that explicitly reduced the direct association between the private company and the protocol. During that period, focus shifted toward separate ventures, most notably Lens, and other product initiatives.
This is not a moral judgment. Private companies can and should allocate resources where they see fit. The governance question is simpler: when the protocol’s day-to-day execution is carried by the DAO ecosystem, should strategic Aave brand assets and distribution remain under unilateral private control, or should ownership sit with the DAO and be delegated under enforceable mandates.
Who actually carried execution, and what it produced
For the last several years, the bulk of day-to-day execution has been carried by the DAO’s service provider ecosystem.
That includes:
- risk management and parameter updates
- governance execution and coordination
- upgrades and technical stewardship
- strategic integrations and ecosystem growth initiatives
Teams like Chaos Labs, LlamaRisk, BGD Labs, TokenLogic, and ACI have done the work that allowed Aave to remain dominant through cycles.
But this is not just “maintenance”. It is active, compounding market share and revenue generation.
Service providers, including TokenLogic and ACI, have been key players in winning integrations and institutional relationships that drove real users and real borrow volume toward Aave, with the upside flowing back to the DAO via protocol revenue.
A non-exhaustive list of initiatives and wins that illustrate this dynamic:
- EtherFi and the broader LRT wave: onboarding and ecosystem coordination that helped Aave become a primary venue for LRT liquidity and borrowing demand.
- Aave Prime market: Third market of Aave in term of size, reinforced narrative of the ability to deliver curated and lowest risk DeFi and reinforced our relationship with the LST/LRT ecosystems.
- Ethena: integrations and risk work around USDe-related markets that became a meaningful contributor to stablecoin borrow volume and revenue.
- Pendle: ecosystem coordination and market enablement that brought incremental users and activity into Aave markets.
- BTCfi: expanding BTC-related collateral and markets, supporting a major narrative and user demand segment.
- Plasma: a deployment that has already become the second largest network for Aave, contributing meaningful activity and relevance.
- Consensys/Linea and MetaMask integration: distribution-level integration that drove user flow and visibility.
- Rabby wallet integration: improved UX and access for power users, pushing real usage.
- Kraken/Ink: institutional-grade distribution and access paths.
- Bitget Wallet: retail distribution channel integration.
- OKX/X Layer: another major distribution vector bringing users and volume.
If you interact with Aave today, there is a high chance you are using collateral markets, borrowing flows, risk parameters, or incentive programs that were designed, implemented, reviewed, or maintained by independent DAO service providers rather than the original corporate entity.
What is essential here is the curation.
Curation of strategic priorities, the balance between risk and rewards, and the continuous calibration of safe risk parameters is incredibly hard. It is also what allowed Aave to remain safe while still thriving, when competitors with inferior execution fell behind.
The Aave DAO service providers have done stellar work in this regard, and it is work that none in the ecosystem have been able to replicate at the same standard.
This also needs to be stated clearly: innovation and iterative, massive improvement to the Aave V3.x codebase and to GHO have been delivered by DAO service providers. In practice, the DAO has led both execution and innovation.
This makes the Aave DAO unique.
A personal disclosure on alignment
As a former employee and someone here from day one of Aave (not ETHLend), the internal narrative and incentive alignment was token-first, and the same message was carried to external investors. In my case, vesting terms were expressed solely in token terms. I do not hold Avara equity via vesting or acquisition. My incentives have stayed consistent: I have concentrated my efforts on the Aave protocol and $AAVE token because that was the vision we signed up for.
More broadly, it is important to understand that many of the people and teams who built Aave’s operational success over the last three years are now operating on the DAO side, not inside Avara. Several key contributors have spun out to build independent companies committed to the DAO’s long-term success, and many high-impact contributors joined on the DAO side because they believed in the protocol and the token alignment model.
One concrete illustration is how much of the original talent base now contributes through independent, DAO-aligned entities. For example, Ernesto (former CTO) and Andrey (a critical contributor to the Aave.com front end, among other things) have supported execution through independent teams focused on the DAO’s long-term delivery. Another example is David, a former engineer, who went on to found Catapulta and deliver critical infrastructure used by the DAO.
The point is not any individual story. The point is the pattern: a meaningful portion of the “genesis” talent and the most strategic builders are now working independently in the DAO ecosystem. That is a big part of why Aave has been able to keep shipping, keep curating risk properly, and keep compounding market share through multiple cycles.
If value is structurally transferred away from the DAO and toward a private entity, we will lose key talent and weaken the very ecosystem that made Aave successful.
Compensation context: high ROI, low extraction
There is often a misconception that service providers are “extracting” value. The opposite is closer to the truth: service providers are heavily token-aligned, and the cost of maintaining the Aave DAO’s professional execution has been small relative to the value preserved and created.
For transparency, here are the main ACI compensation mandates (with references). Note that some phases were shortened or restructured, which reduced realized amounts versus initial projections.
| Period / Item | Status | Amount | Reference |
|---|---|---|---|
| ACI Service Provider (Initial) | Completed | 250k aUSDT | [ARFC] - ACI Service Provider 6 month Proposal |
| ACI Phase II | Completed | 375k | [ARFC] ACI Phase II |
| “Ad Astra” budget | Completed | 1.0M | Aave - Open Source Liquidity Protocol |
| Phase IV stream (later restructured) | Restructured | 1.5M | Aave Governance - Proposal 301 |
| Ongoing stream with Service Providers Compensation Reform (current) | Active | ~200k + 250k$ AAVE | Aave Governance - Proposal 401 |
Total approved across the items above (nominal): ~$3.5M over three years, for a team of 11, with realized amounts lower due to restructuring and timing.
When you compare that to the scale of protocol revenue and market position preserved and expanded through DAO execution, this is not a story of extraction. It is a story of professionals being paid to keep the engine running, while remaining structurally aligned with the token.
Why this matters for the IP and distribution debate
When control of the “storefront” (domains, handles, naming rights, trademarks, distribution channels) sits outside the DAO, it creates a structural risk.
Even if the private actor behaves well today, unilateral control means:
- terms can be changed unilaterally
- distribution can be redirected
- monetization can be captured
- the DAO’s negotiating power stays structurally weak
This is unnecessary. Avara can thrive, and the DAO can thrive. The clean solution is straightforward:
- Ownership of strategic brand assets should sit with a DAO-controlled vehicle.
- Management can be delegated back to Avara under a clear, enforceable mandate.
- Monetization should be DAO-defined and negotiated from a position of ownership, with fair terms for everyone involved.
We are not asking for a favor. We are asking for governance and ownership to reflect the reality of who built, maintained, and grew the protocol over the last four years.
Aave is still a goose that lays real golden eggs.
But that goose did not grow itself, and it does not stay healthy on autopilot. It is fed, protected, and continuously improved by an ecosystem of contributors who show up every day to curate risk, ship upgrades, maintain integrations, and keep the protocol innovative and competitive.
If the system stops being fair, and stops rewarding merit, the outcome is predictable. Talent will exit, quietly at first, then all at once. The people who keep the engine running will not keep doing it indefinitely if the rules signal that their work is optional, replaceable, or taken for granted.
And only then, when the goose is no longer laying as many eggs, will everyone fully understand what Aave lost.
DeFi will win.