Key Highlights
- Aave holders rejected a proposal to shift control of brand assets to the DAO, with over 55% voting against it.
- Some token holders said AAVE still lacks a clear way to capture value, highlighting broader DeFi governance challenges.
- Lido advisor Hasu urged aligning governance under a single token or equity structure to resolve conflicting incentives.
Aave token holders have decisively voted against a contentious governance proposal that aimed to give the DAO full ownership of the protocol’s brand assets. The Snapshot vote ended in a clear rejection, with most participants either voting against the plan or choosing not to support it.
When the poll closed on Friday, about 55% of voters voted “no,” while more than 41% abstained. Only around 3.5% voted in favor.
If approved, the proposal, known as the Brand Asset ARFC, would have shifted control of Aave’s domains, social media accounts, naming rights, and other intellectual property to a DAO-controlled legal entity.
The Spark: “Stealth privatization” concerns
The governance rift intensified following a December 4 partnership with CoW Swap. On December 11, community delegates discovered that swap fees were being directed to a private wallet controlled by Aave Labs rather than the DAO. This led to accusations of “stealth privatization” and prompted a “poison pill” counter-proposal suggesting the DAO absorb Aave Labs entirely.
Tensions reached a breaking point on December 22, when Aave Labs moved the brand ownership proposal to a Snapshot vote. The proposal’s listed author, Ernesto Boado of BGD Labs, publicly denounced the move, calling it a “disgraceful breach of trust” because the vote was triggered while community debate was still active.
Kulechov’s conviction and “healthy debate”
Aave Founder Stani Kulechov, moved the proposal to a Snapshot vote on December 22. Critics said the decision came without broad community agreement and while discussions were still ongoing, raising concerns about process and participation.
The episode also renewed debate around influence in token-governed systems. Some community members pointed to Kulechov’s recent AAVE purchase as highlighting how large holders can draw scrutiny during contentious governance decisions.
Kulechov said the vote sparked an important discussion about alignment between Aave Labs and AAVE token holders. He described the debate as a normal part of “decentralized governance” and acknowledged that Aave Labs has not clearly explained its economic relationship with the DAO in the past, saying this would improve going forward.
Addressing concerns around his recent $15 million AAVE purchase, Kulechov said the tokens were not used to vote on the proposal and were never intended to influence the outcome. Instead, he framed the buy-in as a personal signal of long-term alignment at a time when Aave generated a record $885 million in fees in 2025.
He added that the DAO earned about $140 million this year, which remains under the control of AAVE holders, and said Aave Labs will be clearer about how its products create value for the DAO. “This is my life’s work, and I am putting my own capital behind my conviction,” he said.
Deeper structural tensions
Supporters tended to think it would improve decentralization and resolve questions about who owns the Aave brand. Many community members felt the proposal raised more questions than answers, especially about long-term rewards and governance.
The failed vote exposed deeper tensions within Aave’s ecosystem. Some large token holders argued that the protocol still lacks a clear way for the AAVE token to capture value, a problem they say affects not just Aave but many major DeFi projects.
Wintermute CEO Evgeny Gaevoy said his firm voted against the proposal while calling for more serious discussions about long-term alignment between the protocol, token holders, and related entities.
Others focused on structural issues. Lido advisor Hasu said the dispute highlights a broader problem with setups where governance tokens coexist with separate equity-based companies.
According to him, these dual structures create conflicting incentives and make effective governance harder over time, adding that many investors view them as temporary and expect a clearer, unified structure in the future.
Hasu added, “As a long-time investor in Aave, I hope all parties can come to the table and design a solution that aligns everything either under a singular token or equity structure, similar to Uniswap’s UNIfication proposal.”
Overall, the episode has become a case study in DAOs’ challenges of managing power, identity, and value. While the proposal failed, it has intensified the debate over how Aave-and similar protocols-should structure governance going forward.
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