■ Aave Faces Internal Conflict: DAO vs Labs
■ Summary:
Aave DAO and Aave Labs are in dispute over fees from the new CoW Swap integration. The integration allows users to manage swaps, collateral, and debt efficiently with MEV-resistant execution and lower gas costs. However, $10M/year in potential fees are reportedly flowing to Aave Labs’ private address instead of the DAO treasury.
■ Points of Contention:
DAO’s stance: Fees should belong to the DAO as they fund and govern the protocol; this is seen as “invisible privatization” of community assets.
Labs’ stance: Fees are generated by the frontend/product layer, independently developed and maintained by Labs; prior surplus to DAO was voluntary, not mandatory.
■ Historical Context:
Past projects like Horizon RWA lending caused DAO losses (~$400k), while Labs could profit from other revenue channels.
Conflict reflects on-chain governance dilemmas: DAO bears risks, but revenue is sometimes captured elsewhere.
■ Comparison to Uniswap:
Uniswap faced similar issues in 2023 with frontend fees (0.15%) leading to token holder concerns.
Recent UNIfication proposal resolved revenue allocation and governance integration, setting a potential blueprint for Aave.
■ Implications for $AAVE Holders:
Token value may not fully reflect increased product usage if Labs captures revenue independently.
Lack of clear interest distribution and transparency risks weakening governance confidence.
■ Takeaway:
The Aave conflict highlights the urgent need for clear governance rules distinguishing protocol vs frontend revenue. Resolving these disputes is critical for maintaining DAO integrity and token holder value.
