Key Highlights
- Aave DAO approved a $25 million funding package for Aave Labs with about 75% support after a long governance dispute.
- The “Aave Will Win” framework now directs 100% of revenue from Aave-branded products into the DAO treasury.
- Aave Labs will receive funding in stages, including $25M in stablecoins and 75,000 AAVE tokens over 48 months.
Aave DAO, an open source protocol, has approved a $25 million funding package for Aave Labs on Sunday, April 12, 2026, through an on-chain vote.
This decision was made after a months-long dispute over who controls revenue and key parts of the Aave system, and how money made by the protocol should be shared. The vote passed with about 75% support, according to the website.
Revenue control moves fully to the DAO Treasury
The vote also activates the “Aave Will Win” framework, a governance structure designed to redirect 100% of revenue from Aave-branded products back to the DAO treasury. This includes income from swap fees and products such as Aave App, Horizon, Aave Kit, and future services like Aave Card.
In simple terms, it means all earnings from these products now belong to the community treasury instead of going to outside groups. The goal of this structure is to ensure that AAVE token holders receive the economic value generated by the protocol and its applications.
Funding details and payment structure
The vote recorded 522,780 AAVE tokens in favor and 175,310 against. It followed a narrower “temperature check” vote in early March 2026, which passed with just 52.58% approval.
Under the approved plan, Aave Labs will receive $25 million in stablecoins. The payment is not given all at once. According to the proposal, $5 million will be released immediately, starting April 13, 2026, while the remaining $20 million will be sent in stages over 6 months and 12 months. In addition, 75,000 AAVE tokens will be allocated to Aave Labs and will be unlocked gradually over 48 months.
How the governance dispute began
This decision came after a long disagreement that started in December 2025. At that time, Aave Labs added CoWSwap to the Aave interface and moved swap fees away from the DAO treasury.
This caused concern in the community because members believed it reduced the money going to token holders. The issue eventually grew into a wider conflict about who controls Aave’s website, branding, and revenue systems.
Meanwhile, there have been earlier proposals in March 2026 to transfer control of certain assets to a DAO-controlled legal structure. But it was rejected with 55.29% voting against and more than 41% abstaining.
The dispute led to tensions within the ecosystem, which made several contributors depart from the project, including BGD Labs, the Aave Chan Initiative, and Chaos Labs, who cited governance and operational concerns.
What it means
Despite the conflict, the final vote outcome consolidated control under the DAO. Revenue from Aave-branded products is now directed to the treasury, including income estimated at $10 million to $20 million annually from swap activity alone. Protocol revenue reached about $140 million in 2025 and is projected to remain at a similar level in 2026.
In addition, Aave Labs will continue to handle development work under DAO oversight, while future funding and upgrades will require separate governance votes.
Also Read: AAVE Exchange Reserves Jump to 2.23M Amid Contributor Exodus and v4 Tension
