AAVE tanked on Monday as tensions escalated around a governance proposal calling for token holders to take direct ownership of Aave’s core brand assets.
Summary
- A back-and-forth over who controls Aave’s name, website, and social media channels has erupted into a full-blown governance clash.
- As a result, the decentralized lending protocol’s token dipped by double digits, exposing a deeper fault line in how DAOs govern assets that live off-chain.
- Earlier, a whale sold 230,350 AAVE worth about $37.6M, pushing price down near $162.
The debate was triggered by a forum post from Ernesto Boado, co-founder of BGD Labs, who argued that domains, social media accounts, naming rights, and other key access points should be formally controlled by the Aave DAO rather than any single entity.
BGD Labs, a community-founded group that emerged in 2022, warned that leaving those assets under third-party control creates a built-in power imbalance. Even when operators act in good faith, Boado said, unilateral authority over aave.com and major social accounts can shape messaging, distribution, and monetization in ways the DAO has limited ability to oversee.
The proposal centers first on ownership rather than product development. Boado stressed that Aave Labs should remain free to build interfaces and release products, but maintained that the DAO should own the protocol’s identity and decide how those assets are licensed or delegated under enforceable conditions.
After several days of discussion, Aave founder Stani Kulechov advanced the proposal to a Snapshot vote, a move Boado publicly opposed.
Kulechov pushes back
The process, Kulechov argues, followed Aave’s established governance rules. In a post on X, he said the proposal had been debated for about five days — a standard timeframe before Snapshot voting — and noted that the DAO has previously voted on proposals authored by third parties. See below.
The vote’s outcome will do more than resolve an internal Aave dispute. It will also highlight a broader DeFi challenge: while DAOs can collectively govern smart contracts onchain, control over brands, websites, and interfaces often sits offchain, where governance is slower, authority is less clear, and incentives don’t always align.
Price action
Aave is currently in the red, down by 8.7% at last check.
Earlier, a whale sold 230,350 AAVE worth about $37.6 million, pushing the price down to $148 at the time of publication.
Source: https://crypto.news/aave-governance-rift-brand-control-sends-token-sliding/
