Civil War Breaks Out on Aave Crypto: CoW Swap Fees Change AAVE Price Outlook

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Does AAVE still have any legs? Well, I’ll answer it for you: maybe not as we head into 2026.

Aave, one of DeFi’s largest and most mature lending ecosystems, is now locked in a public fight over who controls the protocol’s revenue streams. What began as a routine integration with CoW Swap has spiraled into a broader debate about decentralization, ownership, and whether Aave Labs is siphoning off fees that belong to tokenholders.

The controversy erupted when pseudonymous delegate EzR3aL flagged that swap fees from Aave’s new CoW Swap integration were not flowing to the DAO treasury. Instead, they were being routed to a private wallet controlled by Aave Labs.

“Another entity, rather than the Aave DAO, is receiving at least $200,000 per week worth of Ether,” he wrote, estimating an annual loss of “over $10 million.”

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Will Aave Crypto Crash Into 2026? Delegates Say Aave Labs Is Wrongfully Claiming Ownership of DAO-Funded Components

Okay, so here’s the Tl;dr: Multiple governance participants argue that the DAO funded development of the Aave front-end, brand assets, and smart contract adapters. If the DAO paid for the infrastructure, they say, the DAO owns the revenue.

Louis, a VC partner active in Aave governance, warned: “The biggest threat to any token and DAO is a competing, independent equity vehicle.”

Marc Zeller of the Aave-Chan Initiative went further, calling the current setup “a clear attack on tokenholders.”

This flashpoint comes only months after the DAO rejected Aave Labs’ Horizon token proposal, intensifying suspicions that the firm is carving out its own parallel business model.

Aave Founder Stani Kulechov defended the firm’s role, saying, “Aave Labs has been contributing for over 8 years. Aave V4, GHO, and other primitives accrue revenue to the DAO.”

He also argued that adapters enabling swap integrations were funded directly by Aave Labs, not the DAO. But delegates counter that their on-chain budgets paid contractors, including Labs, for the same work.

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So What’s Really Going On With Aave? (The Data Shows This)

According to DeFi Llama, Aave generated more than $110Mn in protocol revenue from Q1 to Q3 2025, with Blockworks Research confirming over $15 Bn in net inflows in Q3 alone. With CoW Swap fees estimated at $10Mn per year, the dispute materially affects the DAO’s balance sheet and long-term buyback capacity.

Aave’s internal conflict now centers on a foundational question: who owns the interfaces, integrations, and revenue rails of a decentralized protocol?

And as someone who has watched protocols fracture under far less provocative conditions, this is the first time I’ve seen a DAO accuse its own core team of “privatization” with the confidence of a shareholder revolt.

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