why would you not just use $aave instead of creating a separate token?
why would 85% of token be allocated to non-$aave owners/investors?
sounds like an awesome product, but it also seems like aave dao keeping lion’s share for themselves and there is huge risk of cannibalization of aave’s current system’s value.
Made an account to voice concern about this. There should not be a new token. Value should accrue to the Aave token only. The temperature is ICE COLD.
Imagine the core engineering team at Tesla who developed self driving algorithms went to the shareholder base and said
Hey we actually think self driving commercial trucks are a way bigger opportunity than regular cars - we propose take we the technology we developed at Tesla, and start a brand new company to do this truck stuff. Oh by the way, in exchange for the tech we’ll give back let’s say 10% equity in the new company and then 4 years worth of some fraction of revenue (even though the new company won’t meaningfully generate revenue for a while)
That sound cool to all you tesla shareholders? that the core eng team will focus on something completely new and have minimal value accrual back to Tesla? Cool thanks! It’s gonna be great this is like new free revenue for tesla!! We can’t do it at tesla because ya know, we just cant!
This is literally the proposal AAVE labs is making under the guise that they can’t do this because it requires centralization - uh literally just do it under AAVE labs but send all the revenue to the DAO? Is that hard to understand? It doesnt need to be funded UPFRONT, AAVE labs can we rewarded after the fact based on achieving revenue milestones
This is Stani and team handwaving excuses so they can capitalize more for themselves instead of rewarding the larger AAVE DAO eco system
Once again the aligned solution is - AAVE labs gets rewarded for achievements but all revenue accrues to AAVE token/DAO
Your analogy is a little off. This would be like Tesla offering to use it’s infrastructure to aid SpaceX. Both companies are different, but founded by the same group and have similar fields of interest. One company does not take value from the other company because one company operates in a space where the target audience is completely unavailable to the other company.
As mentioned, Horizon is an initiative that will be focusing on institutional adoption. One of the subsets of horizon will involve a liquidity protocol for supplying and borrowing tokens in the RWA space.
However, the Aave DAO cannot create this themselves, as some of the provided liquidity must be supplied by users who sufficiently comply with regulations.
This proposal allows Horizon to use Aave, rather than developing a third party lending service. Because of this, the Aave DAO will get to appreciate revenue from Horizon.
I’m really curious, Is it because AaveLabs and Stani don’t hold much AAVE tokens? Does that mean the interests of AaveLabs’s members are not fully aligned with Aave?
This proposal actually showcases Aave Labs commitment to Aave and the DAO. Rather than creating a new project that abandons the Aave infrastructure in favor of new technologies, Aave Labs is embracing the DAO and allowing them the chance to make Aave the forefront and king of RWA liquidity
I strongly believe that introducing a new token for Horizon is not in the best interest of the Aave ecosystem. While I understand the need for a centralized business model to handle RWA-related legal and compliance issues, this does not necessitate the creation of a separate token. Instead, we should focus on maintaining AAVE as the sole token for all revenue.
Solution:
Aave Labs and its team are significant holders of AAVE tokens, which means they have a vested interest in maintaining the token’s value and integrity. Therefore, it is in everyone’s best interest to avoid diluting the focus and value of AAVE. A unified strategy, where AAVE remains the sole token for all initiatives, ensures a win-win scenario for everyone, aligning interests and preserving the ecosystem’s cohesion.
i think this is a strong response and is more in line with prioritizing aave over aave labs.
This statement while potentially accurate, is the core reason Aave DAO requires tighter incentive alignment between Horizon and Aave. 10% revenue share and 15% of a new token is simply not proper alignment. I think 50% revenue share and 50% of the new token are minimum requirements. The Horizon token is inevitable with the current proposal, saying otherwise is dishonest. Aave must receive an adequate share of these tokens.
Launching a new token by Aave Labs itself is like the founders of Apple Inc. leaving the company and issuing new stock just before the iPhone launch.
Maybe a bad expression of my understanding but this is how it looks like.
As Stani mentioned below RWA is the key growth factor for DeFi and Aave looking forward
The adoption of RWAs marks a pivotal moment for Aave and the broader DeFi ecosystem. It frees DeFi from the ongoing cycle of recycling and leverage we’ve been engaged in until now.
Aave holders have been both implicitly and explicitly anticipating the adoption of RWAs by Aave, guided by various roadmap vision proposals. However, a proposal originating from Aave Labs itself seems counterproductive: the most significant catalyst in DeFi might not benefit AAVE holders in the long term.
If Aave Labs cites centralization concerns as a reason for Horizon needing a token, perhaps the DAO could vote to establish a new entity. This entity could possess greater decision-making powers within the Aave DAO while better aligning incentives for AAVE holders.
Looking beyond Aave, several protocols have expanded beyond their initial use cases while retaining the same token. Consider these examples:
Boros by Pendle
Arkham Exchange (distinct from Arkham Intelligence)
Fluid by Instadapp (which migrated its token to Fluid without diluting INST holders)
Maker provides a strong example of a DAO successfully running an RWA protocol governed by a single token. Despite the DAO’s complexity, the value accrues to MKR (SKY) token holders, even increasing due to token buybacks financed by a successful and growing RWA business.
Introducing a new token is bearish for AAVE, and the proposal is not compelling enough for AAVE holders.
Lol this is clearly an AAVE Labs team member
“You’re lucky we don’t just completely abandon the ship and start a new product all together, there’s nothing stopping us”
Uh ya this a perfect example of how you are not aligned with AAVE Dao
There’s no tesla and space x comparison here
There’s a reason you all didnt just start a new product and are trying to barely toss the dao a bone here - because you know it would look horrible (and is)
That’s not at all what I’m saying. Aave Labs has never proposed to jump ship. We are proposing to bridge the gap between RWA and the Aave protocol, which is incapable of upholding the necessary regulatory standards. By building Horizon’s Liquidity Protocol under the Aave V3 license, this allows Aave and the DAO to tap into a revenue stream that would be siphoned away by another protocol whose interests aren’t aligned with the DAO.
As a DAO, would we rather work to incorporate access to an otherwise unobtainable market share, or should we sit back and watch billions of dollars sail elsewhere?
Please explain - extremely specifically, the following statement at the crux of all of this:
“Its a business model that does not compete or exist in the Aave ecosystem, and will never exist because this is a centralized service business that the DAO itself cannot do technically and legally speaking, and thus is outside of the physical scope of the Aave DAO.”
Please explain why AAVE labs cannot set up a centralized entity that shares 100% of the revenue with AAVE DAO? or even 90% / 10%
If Horizon is able to share some % of revenue, why can it not share 100%?
Is the answer simply because you don’t have to and we can’t make you therefore you want to take more for yourselves?
The question is why should Aave give up 85%+ of value accrual to Horizon, when Aave should get more.
Horizon is being made by Aave Labs, funded by Aave DAO, using Aave reputation, Aave liquidity, Aave code and Aave products.
Horizon would not be possible without Aave.
As stated already, this feedback was noted and will be considered when revisiting the revenue share structure.
The Aave ecosystem is at a crossroads, which will determine its long term value accrual. While there is on-going feedback and work to modify the current Horizon proposal, one thing must remain clear:
Horizon must always remain a subordinate protocol to Aave, both in governance and value accrual.
If Horizon is structured incorrectly, it risks becoming the dominant protocol over Aave, which would be disastrous for AAVE holders.
I have always been on the sidelines as an observer. But this proposal has completely triggered me to create an account to raise my concerns.
Institutional lending protocol should be under full control of the AAVE DAO.
Why would the DAO give up on this massive future potential?
If this is being funded by the DAO using AAVE’s code base, then the DAO should be in full control.
Year4+ with 10% AAVE DAO profit share%? NAY
Launch of a new token? NAY
Putting the DAO’s interest first should the main priority which is not reflected in this proposal.
Will not support this TEMP CHECK
Dear Aave Governance.
In term of business model, it is the B2B / B2C decision.
Aave is both a protocol and a curator.
Initialy in crypto lending market, Dapps have to produce both Code and Risk parameters, which could be to separated business.
All Aave competitors has a more clear vision of their business model.
Compound was a protocol and a curator. Due to Morpho Effect, Compound has switched to curator.
So we have B2B Morpho / Euler and B2C Compound Moonwell.
There is several questions
1 Is Aave is a B2C or/and B2B Business ?
2 If Aave is a B2C and B2B, would B2B sales could impact B2C sales ?
3 How Many B2C markets could be managed ?
4 Is a good B2B deal?
In this case , I think that Aave DAO could manage this US10Y market directly.
It is the same discussion than for Spark
Is Aave a B2B / B2C?
This is either a shocking, unforced error, or something far more cynical. The damage this proposal’s done will expand as awareness grows. The FUD writes itself.
Just Use Aave tossed aside moments after the brand achieved widespread understanding, acceptance, and trust.
Generally understood to be one of the few investable defi tokens, Aave Labs poisons the concept entirely by introducing uncertainty in the future of the token underlying the protocol it intends to use as a launchpad for its greater ambitions.
“My bet is that in 5 years the revenue from Horizon would supersede the existing revenue from the all the existing Aave markets combined.” -Stani, Aave Labs.
Can’t put that one back in the bag.
The cynical take is that Aave Labs intends to use Aave’s reputation and technology to gain advantage in the RWA ecosystem. It predicts there’s more money in Horizon’s future, so why burden itself with paying Aave more than pennies after its usefulness fades?
Just Use Aave - just another crypto broken promise.