Headline: Aave DAO and Aave Labs Clash Over CoW Swap Fees and Control of Protocol IP A governance battle has erupted at Aave as the protocol’s on-chain community and its commercial developer, Aave Labs, spar over who should capture frontend revenue and who owns Aave’s brand and code assets. What happened - On Dec. 4 Aave Labs announced a partnership with MEV and order-routing specialist CoW Swap to improve swap pricing and add MEV protection to the Aave interface. - On Dec. 11 an on-chain analysis by an Aave delegate flagged that swap fees from the new CoW Swap contract were routing to a wallet controlled by Aave Labs rather than to the DAO treasury. Delegate Marc Zeller of the Aave Chan Initiative called the arrangement “stealth privatization,” estimating the flow could equal roughly $10 million in annual revenue that’s bypassing the DAO. - On Dec. 16 a governance proposal demanded that all Aave intellectual property — code, brand and frontend assets — be moved under DAO control, convert Aave Labs into a DAO-owned subsidiary, and require return of revenue previously earned under the Aave brand. A separate proposal from a former Aave Labs CTO argued the DAO should own trademarks, domains and social accounts if tokenholders are funding development and marketing. - Aave Labs responded by saying the CoW Swap integration was not a fee switch, that frontend revenue was a voluntary donation from the company, and that while the DAO owns smart contracts the company retains ownership of the website and pays for hosting, security and frontend engineering. - On Dec. 23 Aave Labs put a Snapshot vote live proposing transferring control of brand assets, domains, social accounts, GitHub repositories and npm packages to AAVE tokenholders. The former CTO said he had not approved the vote, called the timing “disgraceful” and urged voters to abstain while discussions continue. Zeller and others also objected to the timing — during holidays — and raised concerns about recently added delegations gaining voting power just before the snapshot. Founder buying AAVE amid dispute Aave founder Stani Kulechov has been accumulating AAVE tokens during the same period. Social posts cited purchases totalling 84,033 AAVE (about $12.6 million at an average cost of $176) over the past week, including a recent buy of 32,660 AAVE (about $5.15 million) at $158. Those positions were reported as sitting on an unrealized loss of about $2.2 million. Why this matters The dispute highlights a growing fault line in DeFi: who controls the non-smart-contract parts of a protocol (frontends, domains, social channels, package repositories) and who benefits from revenues generated there. Observers say the outcome could set precedent for other protocols where centralized teams build user interfaces and infrastructure while tokenholders govern smart contracts on-chain. Current market context AAVE has traded roughly $155–160 today, compared with about $308 at the start of 2025 — a drop of roughly 50% year-to-date. What’s next Expect more on-chain proposals, delegate debates and potential active governance votes. The issue touches legal, technical and community norms — from IP ownership and corporate structure to the mechanics of fee routing and delegation — making it a key governance test case for DeFi. Read more AI-generated news on: undefined/news

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