Key Developments
Aave’s decentralized autonomous organization backed a proposal to move its V4 protocol toward deployment on Ethereum mainnet, signaling broader support for the upgrade after weeks of governance tension and contributor exits.
On Monday, the proposal to deploy Aave V4 on the Ethereum mainnet garnered near-unanimous support from the DAO, with more than 645,000 votes in favor and less than one vote against, and no abstentions, according to data from the offchain voting platform Snapshot.
The vote marks a shift from earlier divisions within the Aave community, signaling broad alignment around the protocol’s direction as it moves toward formalizing V4’s deployment.
Market Context
According to Aave founder Stani Kulechov, the proposal is expected to advance toward an Aave Improvement Proposal (AIP) vote, a binding onchain vote that would allow the protocol to deploy and activate V4 on Ethereum.
Aave V4, proposed by Aave Labs on March 19, introduces a shift toward a more modular protocol design. It includes architecture intended to separate liquidity from market-specific risk.
Under the model, shared liquidity pools, or “Hubs,” provide capital, while “Spokes” define distinct borrowing environments with tailored risk parameters and exposure limits. According to Aave Labs, the design “preserves the depth and efficiency of unified liquidity while allowing for more precise risk management.”
Aave Labs said the new structure is designed to support a broader range of financial use cases, including assets with different risk profiles, maturities, or offchain dependencies.
What To Watch
According to the proposal, V4 would allow new collateral types and structured credit markets to emerge while maintaining unified liquidity.
The strong backing for Aave V4 comes after a period of governance tension that saw several core contributors step back from the DAO.
On Feb. 20, BGD Labs, a long-time technical contributor, said it would end its involvement with Aave after four years, citing an “asymmetric organizational scenario” and what it described as an “adversarial position” toward its work on the protocol’s existing version.
On March 3, the Aave Chan Initiative, a major governance delegate and service provider, also announced plans to exit after a clash over a proposed funding package. ACI founder Marc Zeller said the organization would wind down its operations after voicing concerns over governance standards and voting dynamics.
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