Following BGDLabs example, the Aave-chan Initiative share it's plans to leave the AAVE DAO in 4 months citing governance capture

The Aave-Chan Initiative (ACI), one of Aave DAO’s most influential governance delegates and service providers, has announced it will wind down its engagement with the Aave DAO over the next four months, citing what it describes as “governance capture” around a major funding proposal for Aave Labs. In a governance post titled “ACI is leaving Aave,” founder Marc Zeller said ACI will not seek renewal of its mandate, will cancel its ongoing funding streams, and will focus on handing over its governance and infrastructure responsibilities before shutting down. According to ACI, the breaking point was the “Aave Will Win” (AWW) funding process, a proposal to grant Aave Labs what Zeller calls “the largest budget in DAO history,” involving tens of millions in stablecoins and additional AAVE tokens under a DAO-funded development model. ACI claims that the decisive temperature-check vote was carried by addresses allegedly linked to Aave Labs voting on their own budget, while ACI’s four conditions for proceeding—centered on transparency, standards, and governance safeguards—went unanswered. In its view, this created a situation where a major budget recipient holds undisclosed voting power and actively uses it on its own proposals, leaving “no role for an independent service provider.” ACI’s exit follows the earlier departure announcement of core development team BGD Labs, which had built and maintained Aave v3, and is being interpreted in coverage as part of a broader internal power struggle over how much real autonomy the Aave DAO has relative to Aave Labs. Over three years, ACI has been responsible for a significant share of Aave governance and strategy—by its own accounting, 61% of governance actions, major incentive programs, and growth in protocol revenue and GHO stablecoin usage—so its withdrawal marks a material shift in Aave’s governance landscape. As part of the transition, ACI plans a direct-to-AIP proposal to cancel its GHO funding stream (with 120 days of funds routed to its treasury to complete the wind-down) and will cut its AAVE vesting stream, while open-sourcing or transferring its governance tooling, incentive program documentation, and multisig roles to the DAO or successor providers. Aave Labs and the protocol are expected to continue operating normally, but the episode intensifies ongoing debate about DAO governance standards, delegate independence, and the risks of concentrated voting power in major DeFi protocols. "entities":["Aave-Chan Initiative (ACI)","Aave DAO","Aave Labs","Aave protocol","Marc Zeller","BGD Labs","GHO (Aave-native stablecoin)","AAVE (token)","Aave Liquidity Committee (ALC)","GHO Stewards","Aave Guardian multisig","Skyward (ACI governance program)","LlamaPay"]}}

✨ AI-generated background, compiled from web sources — not editorial content.

More coverage

• Aave Chan Initiative to exit Aave DAO after governance clash over ... (tradingview.com)
• Aave Chan Initiative to exit Aave DAO after governance clash over ... (binance.com)
• Aave governance firm exits $27bn DeFi giant as protracted power ... (dlnews.com)
• ACI is leaving Aave - General (governance.aave.com)
• Marc Zeller's ACI Exits Aave Amid Governance Rift - "The Defiant" (thedefiant.io)

Explore the topic

• AAVE
• Governance
• Aave