The DAO Won, but the Deal Isn’t Done
This proposal is a victory for the Aave DAO.
Back in December, @EzR3aL, a truly independent delegate, posted a revenue question that kicked off a broader community conversation about revenue alignment, governance transparency, and the relationship between Aave Labs and the protocol. Today, Aave Labs is offering to direct 100% of product revenue to the DAO treasury, ratify V4 as the shared technical foundation, and create a Foundation to hold the brand. That did not happen by accident. It happened because governance worked.
The direction is right. I have been publicly advocating for exactly this kind of token-centric alignment. The destination is correct. The route needs work. Here is what the community should understand before voting.
Read the Fine Print
The headline is “100% of Aave-branded product revenue to the DAO.” A genuine and welcome commitment. Proof that decentralized governance produces real outcomes.
Governance also means reading the details.
“100% Revenue” Needs a Definition the DAO Controls
Revenue is defined in this proposal as gross product revenue minus partner revenue sharing, minus revenue rebates, minus revenue subsidies, minus “additional direct user incentives.” All deductions are at Aave Labs’ sole discretion. No independent audit. No cap. No DAO approval threshold.
The proposal also states: “Aave Labs retains the discretion to redirect a portion of product inflows, such as vault yields, directly into user incentives.”
100% of revenue is a powerful commitment. The DAO needs to define what revenue means , not the entity being funded from it. An independent auditor verifying the number and DAO-approved caps on discretionary deductions would turn a headline into an enforceable commitment. A small change that makes the entire proposal credible.
The Treasury Cannot Absorb This Ask
The Aave DAO treasury holds $160.9M, down $44.8M. Of that, $100.6M is non-AAVE assets and $60.2M is AAVE tokens.
This proposal requests $42.5M in stablecoins ($25M primary + $17.5M in milestone grants) and 75,000 AAVE. The stablecoin ask alone is 42% of the DAO’s non-AAVE reserves. The total ask of roughly $50.7M is 31.5% of the entire treasury. For a single service provider. In a single vote.
No funds or tokens should transfer until enforceable commitments are in place.
V3 Built This House
Aave V3 generates over $100M in annualized protocol revenue. The most proven lending infrastructure in DeFi. More than 95% of all Aave DAO historical revenue comes from V3 and its predecessors.
This proposal frames V3 as “approaching its architectural limits” and asks the DAO to ratify V4 as the replacement. Buried in the maintenance plan: “It also makes sense to pause any new features for V3 if this framework is passed.”
V4 may well be the future. Today, it is on testnet, has some completed audit, and has generated zero revenue. The right approach is parallel-track: protect the V3 cash engine while accelerating V4 validation on its own timeline. Ratifying an unshipped protocol while freezing the $100M per year revenue engine in a single bundled vote is premature. V4 should earn its ratification through its own proposal, on its own merits, when it is ready for mainnet.
Unbundle the Vote
The FAQ states: “Voting on these items separately could result in a fragmented and unworkable plan.”
This is four proposals in a trenchcoat. Revenue alignment, V4 ratification, Foundation creation, and a $50M funding request are four separate decisions with different risk profiles and different levels of community consensus. The community broadly supports revenue alignment. It may also support V4 ratification and a Foundation. It has serious questions about the funding size and terms.
Bundling them means accepting everything or rejecting everything. If these components stand on their own merits, they can be voted on separately. Let the community say yes to alignment while demanding better terms on funding.
75,000 AAVE Tokens Are Governance Power
75,000 AAVE at today’s price of $109 is roughly $8.2M and represents 13.6% of the DAO’s AAVE holdings (~550,000 tokens). AAVE tokens carry voting power.
Yesterday I published on-chain analysis showing wallets connected to Aave Labs infrastructure voted to defeat the Mandatory Disclosures proposal , a proposal requiring wallet disclosure and conflict-of-interest abstention. That vote is still active and currently losing.
This proposal asks the DAO to transfer 75,000 additional AAVE tokens to an entity whose existing governance holdings remain undisclosed. The DAO should know what governance power the recipient already holds before transferring more. Any entity receiving AAVE tokens from the DAO should meet the same disclosure standard we would expect of any service provider.
What I Support
I support the direction of this proposal. Revenue alignment is correct. A Foundation holding the brand is correct. V4 as a long-term technical direction is correct. The DAO should recognize this moment: engaged governance produces results.
What Needs to Happen First
Direction is not execution, and a Temp Check is not a blank check. I propose the following sequencing:
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Unbundle the vote. Revenue alignment, V4 ratification, Foundation creation, and funding should be separate proposals. Each stands on its own merits. The community can support what it agrees with and refine what it doesn’t.
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Truly independent Foundation. An independent Foundation holding all Aave IP, trademarks, and brand rights should be operational and verified before any funds are transferred. “Independent” means exactly that: a board and governance structure that is not controlled by Labs-aligned members. With voting power concentrated around Labs and the unresolved COI questions, an entity that is independent on paper but aligned in practice cannot serve as a safeguard. How Foundation independence is guaranteed is a question worth asking before any money moves.
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Full wallet disclosure. Any entity requesting DAO funding and receiving AAVE tokens should disclose all wallets under its direct or indirect control. These standards apply to every service provider equally, including ACI.
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Independent revenue verification. Revenue flowing to the DAO should be defined and verified by an independent auditor, with deductions capped or subject to DAO approval. “100% of revenue” must mean something the DAO can verify.
None of these require rejecting the proposal. They require improving it. These conditions can be met in weeks, not months. If they are already planned, formalizing them in the Temp Check costs nothing and strengthens community confidence.
Once these are met, the DAO can evaluate a funding proposal on fair terms, with a real Foundation in place, transparent governance holdings, verifiable revenue, and each component voted on individually.
Good day for Aave governance. The community pushed for alignment and got a response. Now make sure the response is real, enforceable, and fair.
Disclaimer: I am the founder of the Aave Chan Initiative, a delegate platform and service provider to the Aave DAO.