Aave Governance Vote Ends In Rejection After Community Pushback

The failed vote highlights deeper tensions over token value capture, governance power and whether DAO structures can effectively manage protocol identity.

Aave token holders voted against a controversial governance proposal seeking to place control of the protocol's brand assets under DAO ownership.

On Friday, the snapshot poll closed with 55.29% voting “NAY” and 41.21% abstaining. Only 3.5% of voters supported the proposal.

The proposal asked whether Aave (AAVE) token holders should regain control over Aave’s domains, social handles, naming rights and other intellectual property through an entity under a decentralized autonomous organization (DAO). Supporters framed the move as a step toward decentralization and clarifying questions about brand stewardship.

The rejection closed a tense governance episode for Aave, one of decentralized finance's (DeFi) biggest lending protocols. It highlighted how timing, escalation and participation can shape governance outcomes in a DAO.

Beyond the vote itself, the rejection surfaced deeper concerns among influential token holders about how value capture and governance are structured at Aave.

Wintermute founder and CEO Evgeny Gaevoy said on X that the trading firm voted against the proposal while urging Aave Labs to engage seriously on long-term alignment.

Gaevoy said resolving token value capture remains critical not just for Aave but for the broader crypto ecosystem, adding that success on that front could serve as a model for other protocols grappling with similar challenges.

Meanwhile, pseudonymous Lido advisor Hasu framed the dispute as part of a more fundamental problem with token-equity dual structures.

In an X post, Hasu argued that combining governance tokens with separate equity entities creates misaligned incentives that are “fundamentally broken” and makes effective governance difficult.

Source: CoinTelegraph