AAVE Price Slides 10% as DAO Governance Dispute Triggers Sell-Off

AAVE fell 10% during the early hours of the Asian session on Monday, following a $50 million sell-off triggered by growing governance tensions.

The plunge comes amid allegations that Aave Labs, the company led by founder Stani Kulechov, redirected millions in swap fees from the DAO treasury without the approval of token holders, igniting debate over decentralized governance and founder control.

Revenue Dispute Sparks Community Outcry, AAVE Price Drops 10%

Amidst DAO governance drama and revenue controversy, the AAVE price has dropped by over 10% in the last 24 hours, trading at $159.86 as of this writing.

AAVE Price Performance. Source: BeInCrypto

The controversy centers on Aave’s integration of CowSwap into its frontend, replacing ParaSwap. Critics claim that this shift, completed after Aave Labs received a grant from CowSwap, diverted up to $10 million in potential annual revenue away from the DAO.

An open letter from an Orbit delegate stated that the ParaSwap integration generated approximately $200,000 per week for the DAO.

DeFi community members argue that redirecting these fees undermines the DAO’s decentralized governance model.

Did Aave Labs quietly redirect millions in swap fees away from the DAO treasury?https://t.co/lwXbsbkZPx$Aave delegate @DeFi_EzR3aL just posted some on-chain research. The following thread breaks down his post