Aave Governance Dispute Escalates as ACI and Aave Labs Issue Dueling Funding Reports

Aave is a decentralized lending protocol governed by AAVE holders, and the dispute centers on the DAO’s product revenue and control over core maintenance. On February 25, 2026, the Aave Chan Initiative (ACI) alleged that Aave Labs had received about $86 million in funding over the years without disclosing returns on that investment or related wallets. Aave Labs countered by pointing to its record of developing V1 through V3 since 2017.

The “Aave Will Win” temperature check passed on March 1, 2026, with support of just 52.58%, after which ACI announced it would exit by July. An onchain vote on April 12 approved the first phase by 522,780 votes to 175,310: the DAO will allocate $25 million in stablecoins and 75,000 AAVE to Aave Labs, while revenue from all Aave-branded products will go to the DAO. A separate proposal will determine growth funding.