Aave governance tensions intensified as another key service provider, the Aave Chan Initiative, announced its departure. The group cited aggressive control and lack of transparency by Aave Labs as the reason. The move follows a similar exit by BGD Labs and contributed to a nearly 10% drop in the AAVE token price, with large investors significantly reducing their holdings.
The Aave Chan Initiative (ACI) has announced it will exit the Aave ecosystem in four months. This follows BGD Labs, which made a similar move last month.
ACI cited Aave Labs‘ aggressive control and lack of transparency as reasons for leaving. “There is no role for an independent service provider in an environment where the largest budget recipient (Aave Labs) holds undisclosed voting power and uses it on its own proposals,” the group stated in a governance post.
Aave Labs CEO Stani Kulechov acknowledged ACI’s contributions but maintained the exit would not affect the ecosystem. “The protocol continues to operate as normal, and incentive programs are unaffected,” Kulechov mentioned on social media.
The governance crisis began in late 2025 after ACI’s Marc Zeller accused Aave Labs of appropriating DAO revenue streams. To address this, Aave Labs requested $50 million upfront in exchange for sharing all future revenue from products built with the DAO.
That proposal passed narrowly with a 52.58% majority. Some analysts believe the DAO has now lost control of the protocol’s roadmap to Aave Labs.
The ACI exit news led to a nearly 10% drop in the AAVE token price on March 3. The price fell from $127 to a low of $107.
Data from Santiment shows deeper concerns among large holders. Whale wallets holding 1 million to 10 million AAVE tokens have nearly halved their exposure since late January.
