[TEMP CHECK] Aave 2030


We would like to thank Avara for presenting this ambitious vision for Aave’s future.

Technical Perspective

We really love V4. V3 was a big upgrade from V2, and V4 feels like a giant leap. As we work all day on V3, we are aware of limitations and optimization opportunities, so this proposal includes plenty of exciting things. We could go find details in things we appreciate, but that would amount to restating the innovations presented in [TEMP CHECK] Aave Protocol V4 Development Proposal.

Proposal Scope:

There is no precedence of a new service provider being “engaged” for 12 months, as historically the DAO employs service providers for six months twice before doing larger agreements. we think it makes little sense to slow V4 development and add friction for Avara by forcing them to come back to the forum in six months to show progress. Therefore, we have no issue with a 12-month initial engagement.


In terms of budget: The initial one was well above reasonable, the current one is still very expensive (we’re nearly $1m per person actually working on it), and with the Audits cost on top, we’re reaching an expected $14m budget for 12 months, we believe there’s still optimization room with the budget. If the budget is approved as such, Avara will become both the largest service provider expense for the DAO (above all other service providers’ budgets combined) and represent more than one-third of the DAO’s overall budget. we’re concerned if this budget is approved, the DAO will face a large “compensation inflation” from service providers that would love to operate with the same profit margins as Avara.

However, we worked hard for the past 18 months, and we’re quite proud to say that we can afford it thanks to the efforts of several service providers such as Tokenlogic & Karpatkey. That said, if DAO revenue declines, we might need to cut some expenses or eat the treasury reserves. Personally, I think V4 is more important than Merit, even though merit is a great growth tool that generates DAO revenue.

What is certain is that in the current setup, I don’t see how we can cut the AAVE emission for stkAAVE and stkBPT in the safety module and replace them with GHO. The protocol will need to generate more revenue to allow it to be reconsidered. That’s a blow in our tokenomics roadmap, but the “Aave Chain” and unified liquidity vision are a paradigm shift in terms of Aave Tokenomics.

Community Culture

Avara is the starting point of everything we have now; their contribution is appreciated and known by all parties. What is proposed here is an important cultural shift with historical relationship.

This protocol started with Avara as the sole contributor and captain of the ship, then with maturity, the DAO grew stronger and we are now rich of an ecosystem of service providers adding value in a sustainable way with resources generated with actual economic activity of the protocol itself.

This proposal is widely different than the V3 proposal made almost two years ago. V3 proposal was “hey we made V3 we didn’t tell you shit about beforehand, here’s the code, give us 15 millions bucks + 1.3M for audits, bye”

Now this proposal is “Hey, we wanna build V4, we didn’t tell you shit about it beforehand but here’s what it is, and give us 12M$ + Audits and let’s get to work”

We are convinced Avara is well-intentioned about becoming an actual service provider and joining the DAO ecosystem of service providers. Their integration would be another step toward the DAO’s full decentralization and maturity.

We believe that, as service providers and delegates, we need to be welcoming and reinforce our DAO’s collaborative and coordination mindset. As such, we will encourage more communication between DAO actors and Avara. For example, to the best of our knowledge, most service providers had little to zero prior knowledge or ability to find synergies with Avara to contribute to the current proposal crafting.

The DAO already spent >2M$ on the best risk team of our ecosystem @ChaosLabs, we are convinced their input would have been valuable for the numerous risk-associated features of V4

The DAO already works with BGD labs on protocol-level contributions; the lack of coordination at the drawing board stage in this vertical is likely a missed opportunity for value add.

The DAO works with Aave Finance (TokenLogic & Karpatkey). Elements such as treasury management or new asset offboarding are part of their scope and will eventually be managed by them. To our knowledge, they had no idea before this proposal publication that new features would directly impact their scope and way of operating.

To ensure the success of this integration, it is essential that it works in both directions. Current DAO contributors must demonstrate a collaborative mindset by incorporating Avara’s expertise and potential into their own work, while also allowing Avara to leverage the collective knowledge and resources of the DAO other service providers.

By doing so, we can unlock new synergies and drive innovation, which will ultimately benefit the entire ecosystem.

With the ACI, we went from near zero communication & collaboration a year ago with Avara to currently synergizing for the frontend when a new asset is onboarded, building features that we propose to be integrated to the Avara-operated frontend such as the Merit APY, and collaborating on GHO strategies, steward, and liquidity committee.

We believe that the key to Avara’s successful integration into our DAO ecosystem of service providers lies in adopting a team-player mentality, rather than operating as a separate entity from other contributors. We recognize Avara’s good intentions and will encourage them to demonstrate this shift through their actions.

The ACI supports the proposal overall.

We are looking forward to work more with Avara in the future.