The Aave DAO controversy: who should collect the interface fees?

Aave DAO governance faces a crucial dilemma after Aave Labs’ decision to replace Paraswap with CoWSwap in its main interface. The change is not merely technical: it involves a reconfiguration of the revenue flow that funded the DAO’s treasury.

The Silenced Economic Impact

When Aave Labs implemented CoWSwap as a liquidity aggregator, the fees from swaps stopped going to the DAO’s treasury. According to community analysis, between 15 and 25 basis points in commissions are now redistributed to external partners. On-chain data suggests that the annual volume captured by these third parties could reach several million dollars.

This change raises an uncomfortable question: Should an interface built on the reputation of a protocol benefit its collective treasury?

Conflicting Positions Within the Community

EzR3aL of Orbit was one of the first to highlight this redistribution of value. Meanwhile, Marc Zeller of ACI argued that app.aave.com, as a protocol product, has a fiduciary responsibility to strengthen the DAO’s funds.

Aave Labs’ response was firm: the interface operates independently and does not directly integrate the protocol. They also pointed out that the margins generated by Paraswap were never contractually guaranteed, giving them the freedom to make product decisions without restrictions imposed by governance.

What Options Are Left on the Table?

The DAO is not trapped. A potential solution is to develop its own user interface, capturing the entire fee flow. However, this would require investment in development and operational resources.

Fundamentally, this controversy reveals a deeper tension: the need to clearly separate protocol decisions from product decisions. The next steps include redefining these boundaries and establishing governance frameworks that prevent future conflicts between independent labs and community treasuries.

The Aave DAO has the opportunity to turn this dispute into a precedent that strengthens its governance structure in the long term.