Aave Will Win: The Ledger of Power

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In the dim corridors of the Aave ecosystem, a governance dispute sharpens its teeth like frost on a windowpane. Marc Zeller, founder of the Aave Chan Initiative, releases what he calls an “audit” of Aave Labs’ record, seven hours after Aave Labs unveiled its own contributions report, just before a funding vote that pretends to decide destinies while counting coins.

Marc Zeller Challenges Aave Labs’ Record in Detailed Transparency Report

The two reports arrive with the inevitability of a winter wind, as the Aave DAO readies to weigh the “Aave Will Win” proposal, which would allocate up to $51 million in fresh funding to Aave Labs and sketch a broader roadmap anchored in Aave V4 and kin.

Zeller’s report, published Wednesday, frames its inquiry around three questions: what Aave Labs delivered, what it cost, and what the return was. He states that Aave Labs has received roughly $86 million in total capitalization, including $16.2 million from the 2017 Ethlend ICO (ICO), $32.5 million from venture rounds, $31.93 million in direct DAO payments and about $5.5 million in swap-related fees.

He notes that the founding team retained 23% of the original LEND token supply, later migrating to AAVE. The audit scrutinizes several initiatives beyond the core protocol, including Horizon, a real-world asset lending market launched in August 2025. Zeller contends that although Horizon reached notable total value locked (TVL), its cumulative DAO revenue sits at roughly $216,000 against reported incentive and maintenance costs exceeding $5 million since launch.

He casts the ratio as a negative return for the DAO. Additionally, Zeller highlights governance participation metrics, multisig activity, and voting patterns, alleging that a concentrated cluster of voting power swayed key proposals, including Horizon and a conflict-of-interest framework vote. He argues that Aave Labs’ forum and on-chain governance activity lags behind rivals, while also questioning the bundling of multiple initiatives into a single vote under the Aave Will Win proposal.

Aave Labs Defends Decade of Development

Aave Labs’ own contributions report, published seven hours before Zeller’s audit, offers a markedly different narrative. The document traces the protocol’s history from the 2017 Ethlend ICO through Aave V1, V2 and V3, crediting Aave Labs with designing and delivering core architectural innovations such as pooled liquidity, Flash Loans, the Safety Module, and Efficiency Mode (eMode).

According to Aave Labs, the technical foundation enabling today’s revenue – including V3’s multi-chain architecture and the original eMode design – was conceived and implemented before most DAO service providers even arrived. The report emphasizes that GHO, the protocol’s native stablecoin launched in 2023, has generated more than $22 million in revenue for the DAO since inception.

The company also details its role in developing and maintaining the aave.com frontend, managing marketing channels, defending trademarks, organizing community events and operating user support infrastructure. It states that public repositories alone include more than 570,000 lines of code, nearly 12,000 commits, and over 4,300 pull requests, with additional private repositories supporting products such as the Aave App and V4.

On revenue attribution, Aave Labs argues that protocol growth has been a cumulative effort involving core architecture, later upgrades, risk calibration, and governance decisions by multiple contributors. It cautions against using governance post counts as a proxy for work performed, noting that major protocol upgrades require years of research and development before appearing as a single proposal.

The dispute has unfolded against the backdrop of BGD Labs’ announcement that it will step away from its service provider role effective April 1, 2026. Zeller cites BGD’s departure as evidence of structural tensions, while Aave Labs has described V4 as a necessary architectural evolution aimed at long-term scalability and revenue diversification beyond ETH-driven cycles.

As tokenholders weigh the Aave Will Win proposal, the DAO confronts two readings: one that clamps down on capital allocation, governance transparency, and recent revenue metrics, the other that honors invention, long-term research, and brand stewardship since 2017.

The vote’s outcome is poised to shape not only the funding relationship between the DAO and Aave Labs but also the strategic direction of Aave’s next major protocol iteration.

FAQ ❓

  • What is the dispute between Aave Labs and ACI about?
    It centers on funding, governance transparency, revenue attribution and the proposed $51 million allocation under the Aave Will Win proposal.
  • How much funding has Aave Labs received from the DAO?
    According to publicly cited figures, Aave Labs has received about $31.93 million in direct DAO payments since 2022.
  • What is Aave V4?
    Aave V4 is a proposed architectural overhaul featuring a unified liquidity layer, dynamic risk premiums and a redesigned liquidation engine, currently live on public testnet.
  • Why does the Horizon product matter in the debate?
    Horizon’s reported revenue and incentive costs are cited by critics as a case study in return on DAO-funded initiatives.

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2026-02-25 21:27