Aave Power Struggle: ACI and Aave Labs Release Rival Reports

Aave governance dispute grows as ACI and Aave Labs publish rival reports ahead of a $50M DAO funding vote.

A governance dispute within the Aave ecosystem has intensified after Aave Chan Initiative and Aave Labs released competing reports on funding, revenue and accountability.

The disagreement comes ahead of a community vote on a proposed $50 million funding package tied to a new operating model for the protocol.

Rival Reports Set Out Competing Funding Narratives

The dispute centers on the “Aave Will Win” framework, which seeks up to $42.5 million in stablecoins and 75,000 AAVE tokens for Aave Labs.

In exchange, Aave Labs would direct 100% of revenue from Aave-branded products to the Aave DAO treasury.

Marc Zeller, founder of Aave Chan Initiative, published what he described as a transparency report reviewing Aave Labs’ historical funding.

He applied a return-on-investment framework to past DAO grants and questioned how funding decisions were measured.

Zeller wrote that “future DAO grants should be evaluated using measurable revenue impact and clearer disclosure standards.”

He also asked whether governance votes should separate funding, revenue alignment and V4 ratification.

Aave Labs Details Historical Contributions

Aave Labs released its own report outlining its role in building the protocol since 2017.

The firm pointed to the development of Aave V1, V2 and V3 as core milestones in the protocol’s growth.

The report cited features such as flash loans, the Safety Module and Efficiency Mode.

It said these features form the basis of Aave’s current revenue model and user activity.

Aave Labs stated that counting governance proposals or forum posts does not capture the full scope of technical and security work.

The firm said maintaining infrastructure for millions of users requires ongoing research and development.

Related Reading: AAVE at Major Support After 86% Crash – 10x Setup Forming?

Governance Vote Raises Broader Accountability Questions

The funding proposal also seeks ratification of Aave V4 as the protocol’s long-term technical foundation.

It outlines plans for a new foundation to steward the Aave brand under a DAO-funded structure.

Some community members have raised concerns about the size of the funding package and the inclusion of 75,000 AAVE tokens.

These tokens carry voting power and may affect governance balance. The debate has expanded to include questions about revenue definitions and governance holdings.

Critics on Feb. 13 called for clearer disclosure standards. The discussion also follows the announcement that BGD Labs will end its involvement with the DAO on April 1.

Tokenholders are expected to vote on the proposal after reviewing both reports.

The outcome may shape Aave governance, funding models and revenue allocation in the coming months.

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