Yearn in Bad Faith: Bully Tactics, Arrogance, and Disregard for AAVE Users

After their most recent proposal, which was co-authored by core ops team member @tracheopteryx, I propose that we issue a blanket denial of any preferential treatment for Yearn.

Their Proposal wanted: 3% fixed interest rate per year, increase of liquidation level to 85% for YFI. In the instance that they get hacked again (as they were last month), AAVE users would have taken losses as this collateralization level far exceeds even the most basic risk parameters.

Furthermore, they have a history of finding technicalities to go against on chain votes within their governance structure (the vote to burn the minting keys was on chain) which suggests that the core ops team that stated development of the proposal has no interest in mutual benefit. They seek amoral increases to their protocol… which frankly is their right to do so. But I do not think AAVE should engage in discussions with those who would behave in such a manner.

They will claim “we are open to debate and want a fully inclusive defi system.” Then why didnt they offer ANY benefit to AAVE at all in their proposal? Either the the core ops team didn’t know it was putting the AAVE protocol and users at risk or they didn’t care. Either way, this is not a team we should engage in discussions for preferential treatment of their usage of our services.

Their “benefit” to AAVE: those putting in USD assets would have higher utilization rates so retail borrowers would have to pay higher APY to offset the 3%.

This type of proposal is unacceptable and I do not believe we should engage in any discussions with amoral actors that seek to maximize their exposure whilst pushing the risk of said exposure onto this protocol.

I think in the interest of mutual benefits to the DeFi ecosystem, they should use the platform exactly as it was intended and not through negotiation of the type of backhanded deals so commonplace in in the traditional banking system DeFi seeks to disrupt.

Link to discussion:


The only way for governance to make a permanent commitment like this is to burn admin keys. Ultimately doubt this is workable right now, Aave is still evolving rapidly and governance needs to ability to upgrade the protocol as it grows.


Accurate - Poorly worded header. Updated.

I need to recognize I feel the same in some way. The current proposal is not a win-win at all.

I do not think stoping discussion is a good thing tho. We need to be careful about the way this proposal is moving forward.

Completely agree with everything here said but perfectly…

Completely agree with what you wrote. Their proposal was basically to get a preferential interest rate from AAVE and we get exposed to greater platform risks. It was an absolute joke.