A fast-tracked Snapshot vote over Aave’s brand control sparked a sharp community backlash on December 22, 2025, as the governance dispute unfolded alongside a double-digit drop in the AAVE token. The episode reframed the debate from a routine DAO process into a broader question of who controls brand assets and revenue levers in DeFi.
Aave governance dispute puts brand assets and fee flows under scrutiny
The Snapshot ballot escalated a dispute over domains, social handles, and intellectual property into an expedited vote while key discussion remained unresolved. Community critics argued the move bypassed established deliberation channels and described the escalation as a procedural overreach. Multiple community voices characterized the push as a “hostile takeover attempt,” including former Aave Labs CTO Ernesto Boado and Marc Zeller of the Aave Chan Initiative.
The recent DAO alignment proposal has been moved to Snapshot after extensive discussion. We realize the community is very interested in a path forward and is ready to make a decision.
Time for tokenholders to weigh in and vote.https://t.co/QwoPeglhmU
— Stani.eth (@StaniKulechov) December 22, 2025
Stani Kulechov defended the process by arguing it did not violate prior discretionary decisions tied to front-end integrations. In governance terms, a DAO is a member-governed structure that allocates decision rights across token holders and voting mechanisms, which is precisely why the speed and sequencing of this vote became the central friction point.
The conflict is anchored in a revenue-flow change after Aave Labs replaced ParaSwap with CoW Swap in the Aave front-end, a switch alleged to divert swap referral fees away from the DAO treasury and into an address controlled by Aave Labs. Community estimates cited in the text put weekly “fee leakage” at about $200,000, implying roughly $10 million annualized impact on the DAO’s income stream. The business question underneath the technical change is straightforward: whether front-end monetization by a development entity is legitimate value capture or an appropriation of community-built brand equity.
Critics argue the procedural issue goes beyond accounting because unilateral technical changes can reshape protocol economics without full DAO oversight. In other words, the dispute is about governance operating model, not just fee routing, and it spotlights how “off-chain” product surfaces like front-ends can still determine on-chain outcomes for treasury flows and tokenholder expectations.
Market reaction was immediate, with one large holder selling 230,000 AAVE in a single block trade valued around $38 million, followed by a sharp same-day slide in the token. Market reports referenced in the text framed the sale as a key trigger for the move, and the sell-off signaled confidence deterioration among concentrated stakeholders who can materially influence short-term price action.
A separate, recent development reduced external uncertainty when U.S. regulators closed a four-year inquiry into the protocol without enforcement action, but the text makes clear that internal governance conflict has become the dominant near-term risk factor. The operational reality is that front-end control can become a high-leverage governance surface that affects token economics, treasury receipts, and the credibility of process.
For traders, treasuries, and institutional allocators, the immediate implication is elevated governance risk with near-term volatility risk layered on top. The next practical focus is the Snapshot outcome and how the ecosystem operationalizes brand and revenue controls afterward, because process legitimacy is now a core input into market confidence—not a soft consideration.
