Aave Governance Rift Widens as BGD Labs Announces April Departure

• BGD Labs has announced that it will exit the Aave ecosystem in April, accusing Aave Labs of centralizing control over the DeFi network.
• It alleges that Aave Labs wants to develop v4 on its own terms and has ‘disregarded v3 and defined its deprecation timeline’ despite v4 not being live yet.

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Bored Ghost Developers, better known as BGD Labs, has announced that it will exit the Aave ecosystem on April 1st, ending a four-year journey that has seen it become one of the network’s most important entities.

Announcing its departure, BGD revealed that it will not be seeking to renew its engagement services with the Aave DAO once they conclude at the end of March, and that it will cease contributing to the network’s development.

BGD is an independent technical services provider hired by the DAO in 2022 to advance improvements like v3, build governance infrastructure, and maintain security tooling. Aave Labs is the core team behind the DeFi protocol, led by founder Stani Kulechov, who believes the network can dominate the $50 trillion decentralized solar energy lending, as CNF reported.

In a detailed post, the company pointed all the blame at Aave Labs. It claims that the Labs have, in recent years, ceased being an independent contributor and taken up a more active role in dictating the ecosystem’s direction. The Labs “believes that the whole Aave DAO and contributors should pivot in the direction they believe in, without sufficient consideration of existing contributors’ expertise,” alleges BGD.

Internal Disputes Threaten Aave’s Future

One of the issues BGD has with the Labs is over product development. BGD has been one of the key contributors to v3, the major protocol currently in use. However, the contribution was largely decentralized, and any interested developer could take part. However, it claims that the Labs has taken control of the development of v4, and is outrightly criticizing and pushing out v3. BGD stated:

The Labs has been pushing not just for v4 to go live, but for v3 to be retired, as it did most recently under the proposed ‘Aave Will Win’ framework, as we reported. As BGD points out, the proposal states that “it makes sense to pause any new features for V3 if this framework is passed.” It then proposes that v3’s features should basically be made worse so that v4 can shine in comparison, encouraging users to migrate.

BGD’s departure could have adverse effects on the network, especially its security. To mitigate, the company has proposed a two-month arrangement where it handles the security side for $200,000, before the DAO can reorganize and replace it.

Commenting on the news, Kulechov said he was “sad to see them go,” but reiterated that the Labs will continue to play its role despite the chaos.

Aave remains the undisputed leader in DeFi. According to DeFiLlama, it controls over a quarter of the total value locked in DeFi platforms at $26 billion, with Lido at second with $18 billion.

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