Aave Labs (AAVE) triggered intense backlash Monday by unilaterally advancing a governance proposal to vote without notifying its author.
This proposal escalated tensions over who controls the DeFi protocol's brand assets.
Ernesto Boado, BGD Labs co-founder and former Aave CTO, publicly disavowed the Snapshot submission.
"This is not, in ethos, my proposal," Boado declared on X.
"Aave Labs has unilaterally submitted my proposal to vote in a rush, with my name on it, and without notifying me at all."
The AAVE token dropped 11% in 24 hours following the controversy.
What Happened
Boado's December 16 proposal seeks to transfer control of Aave's domains, social media handles, and naming rights from current stewards to a DAO-controlled entity.
The specification demands that parties currently controlling these assets transfer them to a vehicle with "strong anti-capture protections."
Aave Labs moved the proposal to Snapshot vote December 22 after what it called five days of discussion.
Boado emphasized the action "breaks all codes of trust with the community" during what had been productive forum debate.
Marc Zeller of Aave Chan Initiative criticized the timing, noting the holiday period reduces coordination among large holders.
He characterized the move as escalating "without resolving discussion, without clear consensus, and without consent" from Boado.
Aave founder Stani Kulechov defended the rushed vote as procedurally sound.
"The discussion has been going over the past 5 days already with various opinions and takes," Kulechov stated, arguing the Snapshot complies with governance frameworks.
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Why It Matters
The dispute exposes fundamental tensions when founding teams maintain private companies alongside supposedly decentralized protocols.
Boado's proposal emerged after concerns that brand assets enable "private monetisation" of products where the DAO lacks practical control.
Recent flashpoints include Aave Labs replacing Paraswap with CowSwap integration, redirecting an estimated $10 million in annual fees from the DAO treasury.
The controversy erupts despite regulatory wins for Aave Labs, including MiCA authorization and the SEC dropping its four-year investigation.
Critics argue the distinction between "protocol" components governed by the DAO and "product" layers claimed by Labs enables value extraction.
The outcome will test whether DAOs can control brands and interfaces that typically sit offchain, where governance is slower and rights are murkier.
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