Aave’s community members and participants have been sharply divided in recent weeks over control of the protocol’s brand and related assets, intensifying an ongoing dispute over the relationship between the decentralized autonomous organization (DAO) and Aave Labs, the centralized developer company that builds much of Aave’s technology.
The debate has attracted mainstream attention because it touches on a central issue facing many of crypto’s biggest protocols: the tension between decentralized governance and the centralized teams that often drive execution. As protocols scale and trademarks gain value, questions of who ultimately controls these assets, token holders or builders, become harder to ignore.
The dispute was sparked by Aave’s integration of CoW Swap, a trade execution tool, which resulted in swap fees flowing to Aave Labs instead of the DAO’s treasury. While Labs argued that the turnover reflected development work at the interface level, critics said the arrangement revealed a deeper problem: who ultimately controls the Aave brand, which has over $33 billion locked into its network. That question has now become central to the debate over ownership of Aave’s trademarks, domains, social accounts and other branded assets.
Proponents of DAO control argue that the proposal would align governance rights with those who bear financial risks, limit unilateral control by a private company, and ensure that the Aave token reflects a protocol governed and funded by token holders rather than a single developer. Those who support the lab take the view that taking fire control away from developers could slow development, complicate partnerships, and blur accountability for running and promoting the protocol.
The proposal has deeply divided community members, with opponents and supporters offering starkly different visions for Aave’s future.
Lab support
Supporters of Aave Labs argue that the company’s continued control of the Aave brand and related assets is critical to the protocol’s ability to execute and compete at scale. They say Aave’s prominence in DeFi is inseparable from Labs’ operational autonomy.
“Something that deserves more weight in these discussions is how much of Aave’s success over the years is due to Aave Labs/Avara, and how challenging it is to run an actual business like DAO,” said Nader Dabit at X, a former Aave Labs employee. “DAOs are structurally incapable of shipping competitive software. Every product decision becomes a governance proposition, every pivot requires token holder consensus, and every fast-moving opportunity dies in a forum thread while competitors execute.”
From this perspective, Aave Labs’ front-end asset management has enabled faster iteration, clearer accountability, and more agile engagement with partners—especially those in traditional finance that require identifiable legal counterparts. Proponents warn that moving fire control to a DAO-powered legal entity could slow down execution at a critical juncture.
KPMG’s George Djuric has argued that forcing Aave Labs into a grant-dependent or tightly constrained operating model would risk turning developers into political actors rather than product teams. Such a structure, he said, would stifle innovation by turning proven developers into “politicians who sing for their supper” every funding cycle.
Other supporters are also pushing back on claims that token control equates to economic extraction from The DAO. They note that protocol-level revenue remains fully under DAO control, and that interface-level monetization—such as swap integrations—is intended to fund continued development that ultimately strengthens the protocol. In their view, the Labs’ work expands the overall financial pie and increases the DAO’s long-term earning potential rather than diminishing it.
A spokesperson for Aave Labs did not return a request for comment by press time.
DAO branded ownership
Proponents of the DAO, which takes control of branded assets, argue that the issue is not about blocking private companies from building products, but about aligning ownership with where execution and monetization now happen.
Marc Zeller, a longtime Aave contributor and founder at the Aave-Chan Initiative, said in an X-essay earlier Tuesday that the DAO has become the engine that sustains risk, sends upgrades and generates recurring revenue, while brand assets act as storefronts. DAO supporters do not dispute that Aave Labs continues to build and maintain much of the protocol’s tools. Rather, they argue that ultimate control over upgrades, funding, and risk has shifted to governance, with Labs acting as a core service provider alongside other contributors funded and overseen by the DAO. Problems arise when a private actor controls the storefront while the DAO ecosystem keeps the engine running.
Much of Aave’s growth over multiple market cycles has come from independent external service teams that help run the system and keep it up-to-date – work that ultimately flows value back to the DAO. If branding and distribution remain under the control of a private entity, DAO supporters say token holders will lack influence over how Aave is represented, monetized and managed in the long term.
The concern is structural rather than personal, Zeller said. If ownership of branding and distribution remains outside of the DAO, token holders have limited influence on how the protocol is represented, monetized, or governed in the long term. The proposal argues that DAO ownership, with delegated management under enforced terms, better reflects how Aave operates today.
“The Aave DAO vs. Aave Labs situation is probably the most important live debate around tokenholder rights today,” investment partner Louis Thomazeau wrote at X, emphasizing the broader implications of the dispute for tokenholder governance models. “This is not just about Aave token holders; it is important to all token holders who are watching this unfold with increasing concern.”
“Stani is out of touch if he thinks we are ‘tired’ of debating token holder rights,” added Sam Rushkin, a Messari research analyst, at X.
From the latest results, about 58% of the votes cast so far are against transferring ownership of Aave-related assets to the DAO, with about a third of voters abstaining. The vote is scheduled to end on Friday.
Read More: Aave Falls 18% Over Week As Dispute Drags Token Deeper Than Major Crypto Tokens
