A December 2025 dispute over swap fees on Aave’s website raised a broader question for DeFi: when a company builds products around a DAO-governed protocol, who should capture the value those products generate?
In commentary published by PANews on December 15, 2025, at 14:47:28 UTC+8, crypto commentator Ignas examined the disagreement between Aave Labs and Aave DAO. The article, translated into Chinese by PANews’ Felix, connected the fee dispute to wider tensions involving real-world assets, ecosystem incentives and the interfaces through which users access Aave.
The distinction matters: control over a protocol’s smart contracts does not necessarily mean control over its website, brand or commercial products.
The swap integration that brought the disagreement into view
On December 4, Aave Labs changed the default swap integration on aave.com from ParaSwap to CoW Swap.
Under the previous setup, users could exchange or reorganize assets without leaving Aave’s interface, with referral fees or positive-slippage surpluses flowing to the DAO treasury. According to Aave documentation cited in the article, swaps under the new integration carried fees of approximately 15–25 basis points.
EzR3aL, an Orbit representative and longstanding Aave governance participant and independent delegate, investigated the destination of those fees. He concluded that they were going to an address controlled by Aave Labs rather than the DAO treasury.
His estimate framed the scale of the concern:
“Assuming only $200,000 is diverted per week, the DAO loses at least $10 million a year.”
That was a conditional estimate, not an established annual loss. The underlying dispute was whether revenue previously received by the DAO had been redirected without its agreement—or whether a separately operated interface was monetizing its own service.
Aave Labs’ position: the interface is a separate product
Aave Labs drew a firm boundary between the protocol and the website. In forum responses quoted by Ignas, it described the interface as a product operated independently of protocol and DAO governance, rather than a protocol component.
Aave founder and CEO Stani argued that earlier transfers to the DAO had been voluntary donations, adding that those funds could instead have been returned to users. From this perspective, the previous arrangement did not establish a permanent entitlement to interface revenue.
He also described the frontend as a product Aave Labs had developed for more than eight years, comparable in principle to third-party interfaces such as DeFi Saver. Labs’ argument was that operating, securing and supporting a product costs money, and that charging for it need not alter the protocol’s own economics. Stani also invoked the Bybit security breach when discussing the importance of secure protocol access.
The source described the DAO as governing Aave’s smart contracts and onchain parameters, rather than owning the brand’s intellectual property. It also noted that governance proposals had granted the DAO broad permission to use Aave’s branding and visual identity for protocol, ecosystem and DAO purposes.
The DAO-side argument: the brand’s value was built collectively
ACI, a service provider to Aave DAO, and its founder Marc Zeller framed the issue differently. Zeller argued that service providers paid by the DAO owe fiduciary duties to it and, through it, to AAVE holders.
He described an implicit understanding: if the DAO made the brand and intellectual property available, profits from the associated frontend should also benefit the DAO. He further alleged that routing decisions could direct volume toward competitors, costing the DAO roughly 10% of potential revenue. The article presented that figure as Zeller’s claim, not a verified outcome.
EzR3aL’s argument centered on how the brand acquired its value. In his view, Aave could charge these fees because the name was widely recognized and trusted—and the DAO had helped pay for that reputation through risk management, service-provider funding and years of governance.
Ignas interpreted this as a distinction between legal ownership and economic contribution. A company may operate an interface, while its commercial appeal also depends on liquidity, trust and risk management sustained by the DAO.
At the time of writing, the article said Aave Labs’ principal concession to critics concerned inadequate communication, rather than agreement over revenue ownership.
Horizon: an RWA initiative under economic scrutiny
The dispute extended beyond swaps to Horizon, Aave Labs’ dedicated real-world-asset instance.
According to Ignas, the initial proposal included a new token with a declining revenue share. Delegates—including Ignas himself—opposed the separate token, arguing that it could dilute AAVE’s value proposition and weaken alignment. The token plan was subsequently dropped, but Horizon proceeded following a contentious vote.
Ignas disclosed that he had voted against deployment, preferring an agreement that would clarify responsibilities and reduce the risk of later conflict.
The economic figures cited in the article came from Zeller: approximately $100,000 in total revenue against $500,000 in DAO-funded incentives, a roughly $400,000 shortfall on that comparison. These figures were a snapshot at the time of the commentary, not a comprehensive assessment of Horizon’s lifetime economics.
Zeller also said that tens of millions of GHO had been allocated to Horizon at returns below the cost of maintaining GHO’s peg. Including those opportunity costs could make the DAO’s position worse, he argued.
For the RWA narrative, the distinction is important: launching a dedicated market is not the same as demonstrating that it generates sufficient returns for the organization subsidizing it. ACI also asked whether any additional benefits, integration payments or offchain arrangements existed outside token holders’ view. The article raised that as a transparency question; it did not establish that such arrangements existed.
MegaETH: who negotiates ecosystem incentives?
A separate disagreement concerned a proposal from Aave Labs to deploy Aave V3 on MegaETH.
Under the terms quoted in the article, Aave Labs would receive 30 million MegaETH points. Those points could then be distributed as incentives in the Aave V3 MegaETH market in accordance with the DAO’s go-to-market strategy. The wording described a possible allocation, not a completed distribution or a stated cash value.
The process itself drew criticism. ACI and other DAO service providers had already proposed a MegaETH deployment in March, and discussions were still underway. Zeller said they learned of Labs’ separate approach only when its proposal appeared on the forum.
The concern was therefore not simply whether Aave should expand to another network. It was also who could negotiate on behalf of an ecosystem supported by the DAO, and how resulting incentives would be disclosed and allocated.
Vaults and the commercial importance of the default interface
Aave Vaults introduced another version of the same ownership question.
Stani described them as ERC-4626 vault wrappers built and funded by Aave Labs. They sit above the protocol and simplify position management. Labs maintained that the vaults were optional products, did not change protocol revenue and could legitimately charge for their services.
Users could still interact directly with Aave markets or use third-party vaults. For Aave V4, Stani said users would also be able to interact directly through Hubs without using Labs’ vaults.
Ignas’ concern was conditional: if Labs-owned vaults became the default V4 experience, they could become the main commercial bridge between users and the protocol. That would allow an independently operated product to earn fees while drawing on the DAO-supported protocol’s reputation, liquidity and trust.
This was a concern about future distribution and value capture, not evidence that those outcomes had already occurred.
The underlying issue: adoption and token value are not interchangeable
Across CoW Swap, Horizon, MegaETH and vaults, Ignas identified the same unresolved boundary. Aave Labs saw itself as an independent builder operating products above a neutral protocol. DAO critics increasingly worried that value associated with the protocol was being monetized beyond their direct control.
That distinction was particularly relevant to the then-forthcoming Aave V4. As more routing, automation and complexity move into layers between users and core contracts, the operators of those layers gain greater influence over the user experience—and potentially over where fees accrue.
Ignas compared the dispute with Uniswap’s frontend-fee debate, describing its eventual removal of frontend fees as an alignment outcome favorable to UNI holders. He favored a similar accommodation for AAVE holders, making clear that his effort at neutrality did not mean indifference to token-holder value capture.
The broader lesson of the commentary is not that product monetization is inherently illegitimate, or that protocol growth automatically benefits a governance token. It is that product adoption, DAO income and token-holder economics are separate measures. The Aave dispute exposed how difficult it can be to reconcile them when responsibilities and revenue rights rest on expectations rather than explicit agreements.
Source: PANews — original article by Ignas, translated by Felix, published December 15, 2025, at 14:47:28 UTC+8. This article reflects the positions and information reported at that time.
