Aave’s token recovery picked up pace this week after Aave Labs pivoted on a contentious governance fight — a development that could reshape how protocol builders and DAOs share value.
On Jan. 2, Stani Kulechov, CEO of Aave Labs (the ecosystem’s largest builder), announced the company will share revenue with AAVE token holders. “Given the recent conversations in the community, at Aave Labs we are committed to sharing revenue generated outside the protocol with token holders,” Kulechov wrote, adding that alignment with tokenholders is “important” and that a formal governance proposal will follow. He also promised to address the related branding and intellectual property (IP) ownership issues that fueled the dispute.
The move is a direct response to a heated December showdown in which the Aave DAO accused Aave Labs of diverting potential revenue away from the community. The DAO demanded that naming rights, protocol brands and other IP be placed under DAO control and pushed for revenue to be returned to tokenholders via buybacks. Aave Labs campaigned against that proposal and helped see it voted down, sparking a governance backlash that knocked AAVE almost 20% lower and erased about $500 million in market capitalization.
Kulechov’s reversal has been met with cautious optimism across the community. Simon Dedic, founder of MoonRock Capital, framed the shift as part of a broader trend: “Slowly but surely, tokens turning into onchain equity. Keep this up and crypto’s future looks very bright.” Community member Tochi argued the change will strengthen token utility and alignment because “revenue generated outside Aave protocol ends up in token ownership.” Even Marc Zeller of the AaveChan Initiative — one of the most vocal critics during the vote — welcomed the move as heading in the “right direction,” while stressing that several areas still need attention for Aave to emerge stronger.
Markets responded quickly: AAVE climbed roughly 10% to about $166 after consolidating near $150 in the days prior. Analysts say a clearer recovery would be confirmed if AAVE can flip the 50-day moving average into firm support, a common technical sign that short-term momentum is turning bullish.
Why this matters: the dispute spotlighted a recurring challenge in DeFi — how to balance contributions from teams and builders with community governance and tokenholder value. Aave Labs’ commitment to route off-protocol revenue back to tokenholders is a step toward aligning incentives, but the details will matter. The formal proposal Kulechov promises to file will be closely watched for mechanisms (direct revenue share vs. buybacks), IP ownership structures, and safeguards that preserve DAO authority.
Disclaimer: This article is informational and not investment advice. Cryptocurrency trading involves high risk; readers should do their own research before making decisions. © 2026 AMBCrypto
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