Aave Considers Sharing External Revenue With Token Holders

At the center of the debate is whether Aave should more explicitly reward its community — and who ultimately controls the brand, revenue streams, and future direction of one of DeFi’s largest lending platforms.

Key takeaways

• Aave Labs plans to share revenue generated outside the core protocol with AAVE token holders
• The move follows a growing dispute between Aave Labs and the Aave DAO over fees and control
• Governance questions now extend beyond revenue to branding, intellectual property, and ownership
• The outcome could shape how Aave expands into real-world assets and institutional finance

Stani Kulechov signaled a willingness to compromise late last week, announcing that Aave Labs plans to share profits generated outside the core protocol with holders of the Aave token. The move follows weeks of friction between the development company and the decentralized autonomous organization that now governs most aspects of the protocol.

Revenue Sharing Emerges as a Pressure Valve

In a blog post, Kulechov said Aave Labs intends to distribute revenue earned from non-protocol activities — such as auxiliary products and external initiatives — to AAVE token holders. While details remain sparse, he framed the decision as a response to growing concerns about alignment between contributors and the broader community.

According to Kulechov, a formal governance proposal is forthcoming and will outline the structure of the revenue-sharing mechanism. For now, the message is clear: Aave Labs is acknowledging that long-term legitimacy depends on tighter economic alignment with token holders, especially as the protocol matures.

Frontend Fees Spark a Broader Governance Fight

The dispute traces back to questions over frontend fees and ownership. Community members raised concerns after discovering that Aave Labs had redirected certain frontend revenues away from the Aave DAO. While Aave Labs originally built the protocol, ongoing maintenance and governance are now largely handled by the DAO — blurring the line between the centralized builder and the decentralized owner.

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That tension escalated in December, when a proposal surfaced calling for Aave’s branding, domains, social channels, and intellectual property to be transferred into a DAO-controlled entity. Supporters argued that full decentralization requires the community to own the brand outright. Critics countered that stripping Aave Labs of control could weaken innovation, execution speed, and strategic coherence.

Expansion Beyond Crypto Raises the Stakes

Kulechov has made it clear that the governance debate is not just about fees or branding, but about Aave’s long-term ambitions. He envisions the protocol expanding into real-world assets, consumer credit, and institutional lending — areas that demand coordination, regulatory navigation, and product discipline.

Rather than a fully centralized or fully community-driven model, Kulechov argues for a hybrid approach. In his view, independent teams should be free to build on top of the permissionless Aave protocol, while the protocol itself captures value through increased usage and revenue. That model, he says, preserves innovation while allowing token holders to benefit from growth.
For Aave, the challenge now is finding a structure that balances decentralization with execution. The promise to share external revenue may ease immediate tensions, but deeper questions about control, identity, and direction remain unresolved — and are likely to define the protocol’s next phase.

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