Aave’s tokenholders approved a governance proposal to start buying back the decentralized finance (DeFi) protocol’s governance token, AAVE, as part of a broader tokenomics overhaul, Aave said on April 9. The proposal — which was approved by more than 99% of AAVE tokenholders — permits the protocol to purchase $4 million in AAVE (AAVE) tokens, enough for one month of buybacks. The move is a “first step” toward a broader plan to repurchase $1 million AAVE tokens weekly for six months. It is also the latest instance of DeFi protocols implementing buyback mechanisms in response to tokenholder demands.“The goal is to sustainably increase AAVE acquisition from the open market and distribute it to the Ecosystem Reserve,” the proposal said. The AAVE token’s price rallied more than 13% on April 9, bringing the protocol’s market capitalization to more than $2.1 billion, according to data from CoinGecko.
Source: AaveRelated: Aave proposal to peg Ethena’s USDe to USDT sparks community pushbackBuybacks gain popularityIn March, the Aave Chan Initiative (ACI), a governance advisory group, proposed a tokenomics revamp that would include new revenue allocations for AAVE tokenholders, enhanced safety features for users, and the creation of an “Aave Finance Committee.”Aave is Web3’s most popular DeFi protocol, with total value locked surpassing $17.5 billion as of April 9, according to DefiLlama. It is also among DeFi’s biggest fee generators, with an estimated annualized fee income of $350 million, the data shows. Aave is DeFi’s most popular protocol by TVL.
Source: DeFILlamaDeFi protocols are under increasing pressure to provide tokenholders with a share of protocol revenues — partly because US President Donald Trump has fostered a friendlier regulatory environment for DeFi protocols in the United States.
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Author / Journalist: Cointelegraph by Alex O’Donnell
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