BGD Labs announces withdrawal from Aave DAO collaboration
Following a four-year partnership, BGD Labs announced its departure from the DAO, pointing to organizational shifts and an "adversarial position" toward its liquidity protocol as key factors.
A primary technical contributor to the Aave decentralized finance protocol, BGD Labs, has announced it will terminate its participation with the project's DAO effective April 1, bringing to a close four years of collaboration.
Through a forum post published on Friday on the Aave platform, BGD Labs referenced an "asymmetric organizational scenario," describing the DAO's handling of the situation as "badly executed" with insufficient regard for the expertise of its contributors. The technical team further noted that Aave had adopted an "adversarial position" toward the third iteration (v3) of its protocol in order to advance features present in the fourth version (v4).
"While all previous points that BGD should just keep contributing on the v3 side exclusively, the situation created makes it nonsensical to us: every time we think/will think about improving v3, there will be some type of implicit/explicit artificial constraint," said BGD. "We are not really interested in being in that position, as we think it is a waste of our potential."
Regarding the transition away from its partnership with Aave, BGD Labs stated that "nothing changes" before April 1, confirming the project's continued involvement with v3, Umbrella, chain expansions, security measures and the onboarding of assets.
Projects currently in progress that are expected to continue following the conclusion of its contributions will be provided with maintenance guidelines, though BGD Labs clarified there isn't a "direct off-boarding path" for the project's ongoing contribution to the Aave protocol. The organization put forward a proposal for the community's consideration regarding a two-month, $200,000 security retainer arrangement extending beyond April while Aave searches for a potential successor.
"BGD Labs was created in early 2022 to build in the DeFi/web3 ecosystem," said the forum post. "Since then, we have been almost exclusively focused on our contribution to Aave: any technical sub-system of Aave that the community knows about, BGD Labs was leading its development, or at least participating/collaborating with other entities in it."
Aave users react to BGD departure
Community member reactions to the announcement were predominantly supportive of BGD Labs, with numerous individuals voicing apprehension regarding the departure of such a vital contributor to the DeFi protocol.
"If independent contributors feel sidelined by DAO-level centralization, maybe the answer is just structural clarity inside the DAO," said user JosueMpia. "Because this feels bigger than one team leaving."
Certain community members directed criticism at Aave founder and CEO Stani Kulechov, attributing responsibility for the project's exit to him. Kulechov also provided a response to the forum post, acknowledging BGD's contributions with appreciation:
"I respect BGD's decision, though I am sad to see them go. The DeFi ecosystem is better for having a team like BGD in it and I hope they continue to build and make contributions to the industry."