Event Overview

Recently, Evgeny Gaevoy, founder and CEO of Wintermute, expressed his opposition to an ARFC-level governance proposal in Aave governance through public channels, drawing significant attention from the DeFi community. According to disclosed information, Wintermute has been involved in the Aave ecosystem as an investor and governance participant since 2022, exercising voting rights and influence in key proposals over the long term. The focus of this controversy quickly narrowed down to two aspects: whether the value capture mechanism of the AAVE token has been weakened or redistributed; and whether the control and related assets of the Aave brand will be transferred to token holders. Discussions within the community around these core issues have escalated in tone, with highly politicized accusations such as "hostile takeover" and "malicious acquisition" emerging, accompanied by emotional speculations about the motives of different factions, which has severely noise-ified discussions that should have focused on technical and economic design. This article will analyze the conflict surrounding the ARFC proposal based on existing public information and limited data, focusing on disclosed mechanisms, roles, and procedural risks, without overly extrapolating on specific terms that have not been made public.

Proposal Focus

In Aave's governance system, ARFC (Aave Request for Comment) is typically seen as a key intermediate step before formal governance upgrades, used to form a clearer consensus on proposals before on-chain voting, thus amplifying the long-term development path of the protocol. Current public information regarding this ARFC proposal indicates that a major controversy lies in whether it will promote some form of transfer of assets or control related to the Aave brand to token holders, a point that has been mentioned multiple times in the community but is still marked as "to be verified," lacking complete supporting text of the terms. Meanwhile, market observers generally believe that the proposal is implicated in reconstructing the value capture mechanism of the AAVE token, specifically how the economic value generated by the protocol is distributed among Aave Labs, token holders, and other stakeholders. However, key details regarding the revenue distribution formula, how brand assets are valued, and whether new token incentive terms will be introduced have not been made public, and according to research brief constraints, these contents cannot be speculated or fabricated. Based on existing facts, it can only be distinguished: on one hand, the controversy regarding the reconstruction of brand control and value capture has been confirmed by multiple parties; on the other hand, accusations involving specific incentive designs, "value alignment" mechanisms, and even the nature of "hostile takeovers" remain in the realm of verification, and readers need to maintain cautious judgment regarding statements that are undisclosed or sourced from a single channel.

Token Value Controversy

Evgeny Gaevoy emphasized in his comments that "the value capture of the AAVE token is the core issue," a statement that actually continues the longstanding topic that has existed since Aave's early token economic design: to what extent can the economic value generated by the protocol be reflected in the AAVE token itself? Historically, Aave has attempted to link protocol revenue and token demand by granting governance capabilities such as voting rights and risk parameter settings through governance tokens, supplemented by mechanisms like security module staking and fee discounts. However, in multiple cycles, the market has repeatedly questioned the degree of disconnection between governance rights and economic rights. According to the public framework, Aave's protocol revenue mainly comes from lending interest spreads and some fees, which theoretically can provide indirect value support for the token through buybacks, fee sharing, or risk insurance. However, there has always been a lack of clear, quantifiable commitments regarding how long these paths will truly benefit token holders and in what proportions. In this context, the current ARFC proposal is seen as potentially redefining the value expectations between Aave Labs and token holders: if brand and related asset utilization is more controlled by Aave Labs, while the value capture design of the token is not simultaneously strengthened, the market may worry that AAVE resembles "a voting certificate without equity"; conversely, if brand and revenue rights tilt too much towards the token side, it may raise concerns about the sustainability of the team's business model. Therefore, when the proposal is questioned for not adequately explaining how value circulates between on-chain tokens and offline brand entities, the mismatch of incentives and governance participation becomes magnified: both institutions and retail investors are unwilling to continue "blindly investing" in a governance structure where value capture is ambiguous, which is why the token value capture issue can quickly evolve into a direct trigger for governance conflict.

Governance Transparency and Process

From a role perspective, Wintermute has been confirmed to participate in Aave's investment and governance process since 2022, being one of the mainstream market makers and liquidity providers in the secondary market, as well as an important address collection in governance voting. This means that in key proposal statements, it carries expectations for financial returns and also bears a certain "professional voter" demonstration effect. In the controversy surrounding this ARFC proposal, some community members have claimed that the voting process shows a tendency for "accelerated advancement," arguing that the procedural time window has been compressed to a level that cannot support high-quality technical discussions, as not all terms have been fully disclosed and feedback from different stakeholders has not been adequately incorporated. Reports indicate that this concern has begun to impact external perceptions of the legitimacy of Aave governance. Meanwhile, the public discourse surrounding the proposal quickly became politicized, with different factions frequently using labels like "hostile takeover" and "malicious acquisition" to accuse each other, replacing discussions that should have focused on numbers, models, and contract terms with emotional narratives. Compared to the idealized vision of decentralized governance, which involves a gradual process of "public discussion → parameter simulation → multiple revisions → sufficient voting," this controversy highlights deviations in reality: the pace of the process is considered too fast, information disclosure is deemed insufficient, and parties are more engaged in debating motives on forums and social media rather than conducting structured analyses of governance parameters and value distribution models. This also explains why institutions like Wintermute repeatedly list "transparency," "procedural justice," and "token value capture" as core standards for assessing the reasonableness of proposals.

Interests and Expectation Games

In this conflict, the expectation differences between Aave Labs and token holders regarding brand control and economic rights are clearly visible. For Aave Labs, the brand and related trademarks, as well as offline collaboration channels, are often viewed as key assets supporting long-term commercialization and compliance strategies, requiring sufficient autonomy to adjust in response to changes in the regulatory environment and new business expansions. In contrast, many token holders hope that the brand and its derivative value can be more directly and systematically reflected in the AAVE token itself, transforming it from merely a governance ticket into a "claim certificate" for the overall growth of the protocol. This structural tension is common in most DeFi projects but has been amplified in this proposal. For institutional participants like Wintermute, their stance in governance is also subject to multiple constraints: first, on the financial level, they hope that their capital investment and governance participation in AAVE since 2022 can yield reasonable returns; second, on the reputational level, as a leading market maker and institutional investor, they need to balance "supporting the sustainable development of the protocol" and "fighting for value for token holders"; third, on the industry discourse level, publicly taking a stand in important governance events will directly affect their cooperative relationships and negotiation leverage within the entire DeFi ecosystem. In this multidimensional game, highly emotional labels like "hostile takeover" and "malicious acquisition" have begun to circulate, the authenticity of which is still marked as to be verified, but it is certain that the prevalence of such discourse essentially reflects a deep conflict over who should hold the final governance authority: whether it should be more centralized control by the core development team around brand and technical routes, or whether token holders should have the final decision-making power over more key resources through on-chain voting.

Risks and Possible Paths

If the ARFC proposal is forcibly passed without fully clarifying the current controversy, it may advance a new arrangement in the governance process in the short term, but it is likely to leave deep governance rifts within the protocol: some dissenting institutions and community members may reduce their future participation or even choose to "vote with their feet" at critical future moments, which will cause quantifiable damage to Aave's trust base and collaborative efficiency in the coming years. Conversely, if the proposal is rejected or forced to undergo significant modifications under high-pressure public opinion, it will weaken Aave Labs' flexibility in utilizing brand assets and strategic planning in the short term, but it may also compel the project team to provide clearer answers in the narrative of token economics, such as whether more verifiable value capture paths will be introduced and how to establish a more transparent linkage between protocol revenue and the AAVE token. In the longer term, this incident may drive improvements in DeFi governance practices in three directions: first, clearer value capture designs that articulate how the brand and protocol revenue feed back to token holders; second, more open and verifiable terms disclosures to reduce governance documents that "tell stories without showing data"; third, reserving more ample discussion and simulation periods for major proposals to avoid the decision-making model of "rushed on-chain voting." For subsequent developments, key dimensions to focus on include: the public rhythm and detail changes of the complete proposal text, changes in the weight of institutions and retail in the on-chain voting participation structure, and the number and content of new governance improvement proposals arising from this incident, without making any predictions about specific voting dates or outcomes.

Data-Driven Conclusion

The controversy surrounding Wintermute and the Aave ARFC proposal vividly presents the structural contradictions that DeFi protocols cannot avoid between value distribution and control distribution: on one hand, the protocol relies on the core team to maintain the brand, iterate products, and respond to uncertainties in the regulatory and business environment; on the other hand, token holders hope that the market risks and governance costs they bear can be rewarded through more certain value capture mechanisms. This tension erupted simultaneously through the two main lines of "AAVE token value capture" and "brand control transfer" in this event, causing governance to rapidly evolve from a technical issue into a game of trust and power boundaries. For both institutions and retail investors, the governance transparency, process compliance, and clarity of the token economic structure in key proposals directly determine whether they are willing to continue investing capital and time in the corresponding assets, which not only affects Aave's future but will also become an important parameter for risk pricing across the entire DeFi sector. Subsequent tracking can be carried out along three data-driven frameworks: first, observing the degree of public disclosure and revision trajectory of the proposal text to assess its specific impact on value and power distribution structures; second, analyzing changes in voting participation composition, concentration, and voting tendencies through on-chain governance data; third, judging whether Aave has formed a more mature governance mechanism after this conflict by combining the quality of subsequent new improvement proposals and forum discussions. Only by continuously accumulating verifiable data along these dimensions can the market more accurately assess Aave and similar protocols' governance and value performance in the next stage.

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