Unchained - Stani Kulechov on Why Aave Labs Is Putting Itself at the Mercy of the DAO

Episode Date: February 18, 2026

Stani Kulechov unpacks Aave Labs’ “Aave Will Win” proposal, explaining why the company wants the DAO to have power over its finances. Thank you to our sponsors! Adaptive Security Aave Labs has proposed a “Aave Will Win” framework that will direct all revenue to the DAO to bring the protocol under “a token-centric model.” In this episode, Aave founder Stani Kulechov explains why Aave Labs is putting its funding at the mercy of the DAO and how the framework could drive DeFi innovation. Plus wen Aave v4? And is Aave Labs’ requested budget too much? Guest: Stani Kulechov, Founder of Aave Labs Previous appearances on Unchained: Why Aave's Founder Is 'More Bullish on Ethereum Than Anything Else’ Why the Founders of Aave and Sky Are Still Bullish on Ethereum DeFi Satoshi, Shorter Blocks, & Secret Plot - The Chopping Block Stani Kulechov on Why Aave Is So Successful - Ep.212 Links: Unchained: Aave Revenue Overhaul Sparks Governance Clash Aave Labs Proposes Off-Protocol Revenue Sharing With Token Holders The Chopping Block: Aave Civil War + Flow Hack + Coinbase Super-App Aave’s Rushed Governance Vote Draws Backlash How Aave Labs and the DAO Should Split Ownership of the Brand – Uneasy Money Uneasy Money: Why Token Holders Have No Rights & Why Every DAO ‘Has Failed’ ‘Poison Pill’ Proposal Calls for Aave DAO to Take Over Aave Labs AAVE Holders Question if DAO Quietly Redirected Revenue Away From Treasury Learn more about your ad choices. Visit megaphone.fm/adchoices

The big thing about the Avey-Will-win proposal is that we want to ensure that we send an extremely strong signal that the value capture is going to the token-centric model. And that is where we and the whole team are fully focused on. Hi, everyone. Welcome to Unchained. You're a no-hap resource for all things crypto. I'm your host, Laura Shin. Thanks for joining this live stream. Before we get started, a quick reminder, not think you hear on Unchained as investment advice. This show is for informational and entertainment purposes only, and my guest and I may hold assets discussed on the show. For more disclosures, visit Unchained Crypto.com. This episode is brought to you by Adaptive Security, the first cybersecurity company, backed by OpenAI. As AI makes deep fakes and synthetic identities easier than ever, Adaptive helps companies test and strengthen their defenses.

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Today's topic is AVE Labs. AVE will win proposal. Here to discuss is Stani Kulachov, founder of AVE Labs. Welcome, Stani. Hey, Laura. Thanks for having me here. Yeah, excited to dig into this proposal. Last week, Ave Labs published a post in the AVEDAO forum called AVEWLWIN that seems to address some issues that were raised in December. Back then, there was a controversy where prior there had been fees from the Dex aggregator periswap that were being directed to the Avey Dow. And after switching it to Cowswap, those were moved over to ABE Labs. This obviously sparked an effort from the community as, you know, happens in crypto. And so it sort of seems that, you know, this recent proposal was to directly

tackle this question of which entity gets, you know, which part of the pie and how much and how the various entities can work together. So just give us the broad outlines of what you put in this Avey-Will-W-W-W-W-W-W-W-Win proposal. Yeah, and I guess in some ways there is sort of like a bigger question about sustainability and growth. I think that the sort of like upgrade from the AVE interface that basically is run by all the labs and developed by your team, we used to have sort of parasywap integration that's based on that integration created a positive slippage in some cases that was effectively donated to the Dow, mainly to regulatory concerns because we couldn't capture any fees over the past years, which kind of like became a sort of ongoing very small revenue stream. And we operated that into a call swap to get a better aggregation and efficiency for the users. And part of that, this ability to give positive slippage basically wasn't anymore created for this integration.

And instead what was this integration about is simply to create non-protacle features for the products that Avalabs built and then create revenue streams. So Avalovs can be so sustainable and continue building and expanding these application layer products to expand the protocol layer. So that is the kind of like a setup that's and how it relates to. to the swap integrations. But the bigger question here is that, and the way we've been thinking of is that, what is the role of Avalab? So obviously Avalabs has started from Eutland

being basically one of the first D5 protocols before D5 was coined within an ICO and raised some of those, funding in 2017 and basically we're building smart contract based lending and it'll turn into AVE down the line which turned into a

relatively well relatively largest defy protocol over the past years and that's all that innovation that has been happened from ABE1, 2 and 3 and now also 4 and go stable coins

everything consists of a set of smart contracts. So the very first time we established the economics for the other protocol was AIP1, where specifically we voiced out that anything that is happening on the protocol level for the smart contracts there is going directly into the other protocol. So every sort of a borrowing that happens across the protocol, whether it's AVA Native Goh stable coins or other stable coins. The protocol earns, and that's the economical activity, and then those funds can be used, paying service providers, and also using for growth initiatives and such. So we've always had this role of being a kind of like a permanent contributor into the AVE protocol,

and everything we simply built from other labs, the idea there is to expand the economical activity of the protocol. And we've been thinking of two kinds of models that could work when we think about the globe. So obviously, like, the defy space between the most peak it was in 2021 and now, Last year, we had another peak. So we've been peaking up to 200 billion for deposit, roughly, as a whole space.

And something that we've been trying to figure out how do we basically scale defar? Because a lot of the growth of other has been happening through consolidation within our space and being able to produce really good products and really good. protocol economics to attract liquidity. And the sort of thinking behind of this ABE will win proposal is to understand how do we actually grow the D5 high, ensure that AVE can be a leader in the space. And at the same time, how does the funding actually will happen? And the way we were thinking about the funding in the past is that Avalap should be a self-sustainable company, grow with, external funding and any growth on other labs and the product layer basically then draws the

economical activity of the protocol. So this is kind of like a simple, well, it's sort of a simple way to understand that the products grow, the protocols you grow. On the flip side, it creates a sort of dilemma and uncertainty for some of the token holders. For example, like if there is protocol activity, which is governed by the token, and then there is a sort of for-profit business that has its own trajectory while growing the protocol, it can get a little bit confusing. So with Ava will win proposal, one of our biggest goals was to actually remove the uncertainty that comes from this sort of a dual model, you know, the AVE token and labs, and sort of direct all the value capture into one specific place

while keeping this sort of a for-profit nature where we understand that's expanding the economical activity of AVE protocol, we have to build products and we have to go where the users are. But those for-profit applications that we built, we simply give 100% of that revenue to the Aver Dow for the benefit of the AVE token holders. and AVE Labs then becomes a sort of fully token-centric model.

And that removes the uncertainty and also expands the revenue capture surface for the AVE token. And then there's other nuances in the protocol as well. But that is kind of like a key point there. Yeah. And the 100% of revenues has a specific definition where there's certain pieces that are you know, it's like minus, you know, the revenue minus certain things that you would want to do for like incentives for users or, you know, other sort of considerations. And then the other kind of main three points are, you know, moving to a model where ABE Labs is being funded by grants

and from the Dow. And there's also an establishment of a foundation for trademarks and other kind of brand assets that are currently owned by labs. And then finally, the ratification of V4, which kind of has a certain technical features that are, it's sort of key to this proposal. So before we get into that exactly, do you just want to flesh out like, you know, where you're coming from, like the Dow and the labs entity, how have they kind of historically either been operating or splitting the pie and then we can move into some of the details. Yeah. Historically speaking, obviously everything was intercepted from one sort of entity, which is all the labs. And over the basic years, we ended up into a model where we have multiple service providers in

the Ava ecosystem. So the way to think about ABA is that in some ways it's an active protocol. So the contrast can be deployed and made imbutable if needed and if there's the band. But what we noticed over the past and looking at how lending has evolved is that there's sort of an active participation that is needed for different functions for the protocol that basically is responsible. management, mostly, and some other functions. So typically when you think about a more simplified protocol like an AMM, what happens is that once you deploy the protocol, there's very little variables that you need to really optimize.

So if you need to optimize the algorithm of buying and selling, typically you just deploy, like it's more easier to deploy a completely new version of a protocol. In obvious example, typically the relationships that users create, especially on the borrowing side, and of course on the deposit side is active ongoing relationships. And that means that because there's a factor of risk involved, that risk needs to be dynamically adjusted into because the market conditions are also dynamic. So the way to think about it is that if the parameters are fully static, there might be cases in times when the risk is, the protocol is absorbing excess risk, which then is on the cost of the borrowers or the depositors.

And to overcome that sort of a challenge, the service program model caters that really well. So there is different sort of participants, they have different roles and they actively create proposals and they're publicly debated. So there's always sort of criticism around DAOs and efficiency, but something we kind of forget is that a lot of the reasons why we know about what's basically happening in Avedo, what kind of parameters are being proposed or asset listings are happening is because there's this wide set of transparency that anyone can actually go and understand what is going on and at the same time also express opinions,

whether it's from a user perspective or talking holder's perspective. And that creates a sort of resiliency that you really want from a lending protocol. And it doesn't necessarily apply to other forms of protocol either. So this is the sort of way how the AVE ecosystem has evolved. And obviously, the protocol makes revenue and that revenue is then distributed because paying these different service providers. So it's a very sort of a decentralized way of trying to kind of like coordinate. And coordination always creates costs, but it comes from the other aspect that we add some resiliency there. And so as I alluded to earlier,

the AVEV4 version, which, you know, isn't live yet, but definitely, you know, kind of is a new evolution for the protocol. It has a pretty specific architecture that involves a hub and spoke model that creates kind of like a broader set of revenue models that are possible with the protocol. and it feels key to the proposal in various ways. So explain, you know, a little bit more about the protocol and why you view it as key to your ABE will win proposal. Yeah, the reason it's very key for the overall proposal is because the proposal relies on a lot of the revenue streams that the AV4 creates and also the expanded use cases.

And I think one really good observation is that ABV4 is, in our opinion, the sort of state of the art of lending protocols because of its flexibility. So the AVV3 allows to deploy, for example, markets with cross-collaritalization, markets without cross-collarization, which basically means that you can simply deposit an asset like Ethereum or Bitcoin and then borrow stable coins without lending out your underlying collateral. So all of those things that the RB3 is capable of. For us, what is very important about V4 is that we notice that actually the use cases of DFI are expanding. So we've been able to grow quite significantly within the existing DFI ecosystem

by use cases like lending against Bitcoin, lending against Ethereum and also looping strategies or integrating yield-bearing stable coins as well and using them as a collateral and trying to leverage your position. So in the current form really allows various different sort of use cases and audiences. And what we notice is that for the future of lending and how we're, want to scale AVE, we need something that is really modular and something that is easy to expand in the future in a way that multiple contributors can actually work on the protocol. So we came up with this architecture of hubs and spokes, and the way it works is that

the V4's hubs is where the assets are stored. But then all these spokes that are connected into the hubs are sort of, lending strategies with their own colorization requirements and they can be also custom logic. And then the hubs are giving credit lines directly to the spokes. And the way to think about it is that a hub is kind of acts as a central bank that is giving credit lines to these sort of commercial banks that then create this lending activity. And what it allows to do is that you can concentrate a lot of the liquidity into your hub,

while at the same time you can isolate risk and cap the exposure into these different spokes. And especially when a lot of innovation comes into defy, it allows any developer to create their own or deploy their own spoke

that over time with the collateral composition can be connected across all the spokes, sorry, all the hubs depending on what is the sort of like overall risk. So it allows the AVE protocol to scale into different risk categories without compromising the main liquidity concentration. And we're also betting that maybe in the future the collaterals might not, for example, be E or C20s. It can be lending directly into qualified custodians where the Bitcoin or Ethereum is sitting and borrowing directly from AVE,

or, for example, lending directly to AVE app consumer users where there's no organization. So that flexibility is what really helps to scale the protocol itself. And second really important design aspect is this so-called reinvestment feature. So investment feature is a way of taking the float that is existing in the other pools, which based on AVE-V-3's data can be anything between a few hundred million, even up to 1.5 billion in some cases, and reinvesting that in a risk-down way where if there's, for example, if AVE pools have lower rates than the risk-free rates in,

with software in chatfi, that can be invested into those sort of opportunities or AVA Native ASCO savings opportunity. So it sort of creates this way of efficiency on how we actually manage the funds within these pools without adding additional risk. And so AVEV4 right now is in TestNet. Do you have kind of, you know, a date when you would expect it to launch, even if it's roughly. Yeah, I would like to see it as soon as possible. The reality is that we started to design OV4 almost two and a half years ago, and we've been working on it more or less two years, and especially the past six or so months we've been focusing on security hardening. We released our first public smart contract audit last week.

We also finished a public security contest end of last year. Everything we built for RVV4 is publicly available. So the code base is publicly available. Anyone can actually look into the code base, you know, give any sort of suggestions and And I think this is the kind of like a core point is that I think over the years what happened with defa is that a lot of these low-hanging foods were built up. So, you know, once you have a really good lending infrastructure, swapping infrastructure, and some yield aggregators involved, you kind of have a lot of the ecosystem being built. And one of the concerns we had from engineering standpoint is that we want to see more native defy innovation.

Like we want to bring the energy back from like the defy summer when, you know, everyone was cooking on some sort of defy innovation. And one way for us to do that is basically have this sort of modular architecture with hubs and spokes where developers can come actually and create. their own customized spoke as a way of requesting liquidity from the hubs that are governed by the Avedau. And if that innovation is secure and scalable use case, then you can create a credit line. And if that use case proves out that credit line can be increased or also the spoke can be connected into multiple hubs. So our goal is here to not only see sort of innovation coming out of the ABA community by the core developers, but also third-party developers that have a really exciting ideas when it comes to DFI,

but maybe they have lack of liquidity, which is one of the biggest problems for a lot of new founders, is that they have a really interesting project, but they have hard time getting those projects boost-strap and out of the ground without decent liquidation. quality and without actually launching a token. So one other aspect of the proposal that I wanted to ask about was the, you know, piece suggesting that AVE set up a foundation. And to my mind, this was to address, again, like some aspect of the controversy in December, you know, out of that there was a proposal, I think, in the forum, you know,

saying that there should be some process. to determine, you know, whether the Dow and token holders should have control over the AVE brand, you know, any associated assets. You know, traditionally all those and still are the property of AVE lab since the Dow is not a legal entity. And I just found it interesting that, you know, you wanted to set up this foundation entity because I'm sure you're very well aware that that model, is maybe in a downtrend, I would say, in crypto. Last summer, A16Z wrote a blog post titled, The End of the Foundation Era in Crypto. So, you know, if A16CZ is saying that they think the foundation era is over in crypto,

I'm so curious, you know, why you felt that this was the time for AVE to actually go that route. Yeah, I mean, you know, A16Z has a lot of bets, you know, but they never bet on Ava and look what happened, right? So I think what they're doing is very ambitious, and I think this really interesting step with the Dunas, and I think Unisop is also exploring with this. Obviously with Dunas, the sort of obviously challenge is that the novelty of the structure. So whoever will be the sort of first of that model,

will have to battle test how it works essentially. And I think it works pretty well for, especially projects that are more US-driven, I think from that perspective. But I think pretty much everything still is running with foundations. But I do think that if that Duna model gets more traction, it gets more proven, it could be a sort of a viable solution for the whole industry. And I think we need solutions like that, definitely. But getting something fast off the ground that is proven model,

the foundation is still the strongest way to do that because that's just a proven model. How can Zahar in a year or two is different, of course. Yeah, and just to let listeners know, Duna is decentralized or Dow or something, unincorporated nonprofit association. Because I myself couldn't remember what that was, but that's like in Wyoming. It's a new, yeah, just centralized, unincorporated nonprofit association.

It was established in Wyoming, or not established, but, you know, that's an architecture that Wyoming offers. And I think Junas have some sort of legal liability protection and also, if I recall correctly, and it does help some of the tax questions as well, but obviously, you know, it has to be proven as well. I'm still, I'm quite excited to be, to be honest, on that model. I just want to see it, you know, grow a bit more. So one other thing that I was curious about was,

I'm sure you're very well aware that there's a number of well-known DAWs that kind of, you know, put a pause or were disbanded over the last year. And here you are in a very different position. The labs is proposing that its own funding basically be at the mercy of a Dow every year. And you might recall that that was the original vision for the Dow in 2016, which was to have the Dow vote on whether or not to fund Slok it, which created that Dow. We won't get into that. But the point is just, you know, that feels like such a big step to me. It's sort of like the labs, you know, has been in control of its own destiny, at least from a financial perspective, more directly. Whereas you are now proposing that there's another entity with a whole set of token holders, you know, that are just very diverse, that will, you know, basically determine.

what your budget is every year, if not 100%, then at least in large part. So, you know, talk with me about why it is that you decided to go that route and, you know, whether you have any nerves about, you know, whether that could work out maybe not so well for you. Yeah, and I think, I mean, one of the challenges I see in our space is that a lot of the things that come into governance styles and sort of, there's sort of an area to explore, right, and experiment. And I think there's always some sort of a narrative that tells that, you know,

this is the right thing to do at that current point. So the DAO was the way to do. And let's say two years ago or four years ago, you had to do certain things, certain way. And now things are progressing into, like, you know, foundation. and from foundations to Dunas and so forth. And obviously my biggest fear is always to, you know, not getting locked into a particular model

and having the flexibility to be able to innovate and not being constrained on innovation. So for me, the big question here is that could Ava as a sort of like, you know, as a project, and this is the other token, the other, the protocol, the Dow, Labs, and, you know, this sort of wider spectrum of the definition. Could it succeed in what it actually needs to achieve with this model, or is some other model needed for that?

So if you look at, for example, where Defi is sitting today, we've really mastered well lending against crypto. There's no other place doing it better than ABE. Like that's, even if I'm saying from like a very biased angle during 10th at 10th, we liquidated it over 200 million worth of collateral in a few minutes. A couple of weeks ago, we liquided it over half a billion worth of course. collateral in a course of seven days without any human work. Like everything happened automatically, automated way. And with some ways prove that actually these protocols and defy can be really significantly better for execution, of course transparency.

But what it actually affects is the cost structure. if this model works and it doesn't create excess that debt in lending protocols, it means that defy is able to offer better core structure compared to the traditional finance. So when we look at something like crypto-back loans in the centralized way, and we saw the FTX happening, we saw TRIRO capital Genesis lending, we saw the whole centralized lending basically collapse, right? And then we saw Overs arriving that market cycle and all the way here. But fundamentally, if you compare it to the existing centralized lenders,

AVE is lending stable coins at 5%. And a lot of decentralized competitors are lending between 7012%. And that just tells that on chain you can have way more better cost structure. Now that if we're able to achieve this really well, with the crypto-native assets, how we can actually take D-Fi and what we're really achieved to do really well,

which is, in my opinion, the capital aggregation. I think there's no better place in the world for capital to move into best financial opportunities as long as they're in the same sort of risk-adjusted categories than in on-chain. So if someone brings a new set of a collateral that is attractive and within the range that is acceptable from risk perspective,

the liquidity will move automatically there. So we've been able to prove that DeFi works, OVWorks, lending works, AMMs work, PIRB's work. This is like a really superior infrastructure. Now, how do we actually go from here and scale the whole usage? And from AVOWWWIN proposal, we have two ways of doing that. One is with the protocol of VB4 level where we expand the use cases of the infrastructure. But the second is the product aspect.

So being able to build something like AVE app that is direct-to-consumer application of AVEP where you download a mobile application, you sign with a wallet that you sign with email, sign with phone number, and under the hood a wallet is created for you that you actually control. We don't need it to know the concepts of wallet, gas fees, networks, everything is abstracted away, and you can link your bank account and deposit into the other protocol as in any sort of existing fintech experience. So that's one big thing, going directly to consumers,

abstracting this away. and the second is obviously providing really good experience to existing sophisticated defile users bringing new collateral through the RVV4 and new spokes and the third which might be even more

important in near term is basically with the AVA kit offering ability to fintech to actually connect into the AV protocol and with the most sort of secure way in offering the yield that is that is great

in defy into these users. So I think with all these components and moving pieces we put together

on the protocol level, on the product level, that should get AVE into sort of next chapter where we're able

to break out out of the crypto assets while we still think the crypto assets will grow and we're going

to double down on them and be a leader there. But we also need to get this technology in front of tens of millions

of people and also kind of like upgrade the chatify rails for better defy rails. Yeah, yeah, it's the defy mullet strategy, which definitely is very smart and already taking off in other parts of the industry. All right, so in a moment, we're going to talk about some of the criticisms and suggested

tweaks to the Obie will win proposal, but first we're going to take a quick word from the sponsors who make this show possible. This episode is brought to you by Adaptive Security, the first cybersecurity company, backed by OpenAI. As AI becomes more capable, attackers no longer need to break into your systems. They just need a convincing imitation of someone you trust. That could mean a deep faked voice on a call, a synthetic coworker on Zoom, or phishing emails written by AI that are nearly impossible to distinguish from the real thing. Adaptive's platform is designed for this new reality.

It runs deep fake, vishing, and AI-generated fishing simulations, so your team can see exactly how these attacks work and practice responding before it happens for real. Their AI content creator also turns new threats or compliance updates into interactive multilingual training within minutes. You can learn more at adaptive security.com. Back to my conversation with Stani. So Mark Zeller of the Abe Chan Initiative, who I think he once came on the show and calls himself Chainsaw Zeller, he wrote a longish response to on act.

praising the general direction of the proposal, such as 100% of the revenue going to the Dow. But he also objected to some of the ways that that was defined. He said that, you know, labs, with that according to the proposal, labs, quote, would retain discretion to redirect a portion of product inflows, such as vault yields, directly into user incentives. And he said the Dow needs to define what revenue means and not have the entity that's being funded by this revenue define it. Multicoin capital also requested the same tweak saying, quote, clear frameworks around deductible categories, transparent product level reporting, and potentially independent

P&L verification would ensure that revenue redirection is economically meaningful and free from conflicts of interest. What is your response to these criticisms and proposed changes? Yeah, I think first and foremost, what's important is that there's part of the the Dow proposals is that all of this discussion is public and anyone can contribute. And I think it sort of reflects the level of transparency that we're basically dealing with. And I think that level of transparency probably doesn't exist anywhere else. So in some ways, it's quite a good feature in that sense. And I think the part of the proposal is that we don't always know exactly what

you know, everyone wants and what are sort of a preference. We do have a vision in our way will win how to effectively grow the products which grow the protocol as well. So part of that, for example, is that we do want to have the ability to actually create sort of a bespoke agreements, for example, with integrators that are, for example, fintech that want to integrate AVE, and we need to be sort of a facilitator there for these revenue share models. So when we're talking about that 100% of the product revenue goes to the ABA DAO, that also means that 100% of the revenue goes to the DAO. And that means that, for

example, if there is a some sort of a distribution channel that wants upside for or some sort of for revenue share, that is something we facilitate, but at end of the day, whatever comes to the direction of AVE, that is passed directly to the AVE lab. So that's something that is important to acknowledge. And the second piece is that it is a temp check. So before the proposal can go as it is, but before the actual AVE request for comments, there's going to be certain types of changes and improvements into the proposal based on feedback. So the feedback has been overly positive, and that's maybe because it's a very unique.

That's a lapse entity just foregoes all the revenue. But also, I think it just demonstrates of the revenue capabilities of the AVE ecosystem and where the future could go. And also having any sort of criticism is actually really healthy. And there's different parts of the doubt that represent different sort of interest. And it's always important to basically go all the feedback and figure out the implementations. Another one of the criticisms by both Mark and Multi-Coin was about the size of the ask. Mark wrote in his post that, quote, the total ask of roughly $50.7 million is 31.5% of the entire treasury for a single service provider in a single vote.

And, you know, Multicoin, as I mentioned, also commented on how large the request was in relation to the Dow's treasury size. So what's your response to their concern there? Yeah, I think something to think about is that the Al-Dal does earn 140 or so million. in revenue. So there's ongoing revenue streams into the Dow that was basically built over the years. And at the same time, part of this proposal of revenue redirection, what actually happens is that all the labs is foregoing any sort of revenue capture that it might have on its own. So the previous model where Avalabs basically operated was that anything that the protocol creates in terms of revenue based on the AIP1 goes into the AVE Dow Treasury.

And any sort of application level product can put their own revenue streams. There is a lot of integrations where, for example, the integrators or applications, they have their own revenue capture there. And that was the initial model for AVE Labs to actually operate, where it takes its own sort of responsibility. for being self-sustainable and at the same time creating revenue streams for labs. But because of this sort of balance question between value capture between the other token and labs, we've noticed that actually creating this clarity where all the revenue goes into one certain address,

under one token is the best approach because that removes the uncertainty about value capture. It makes the model more clear and at the same time, labs is foregoing also a lot of revenue.

So in just thinking about the car swap fees that's between 10 to 30 million in annualized revenue that is going to the labs. And then on the AVE app itself, that's where there's going to be a fee capture. And part of the AVE will win proposal, at the same time, there's going to be features that create

more monetization. And one example is the AVE card. So, for example, whenever someone swipes the AVE card anywhere in the world that creates fees, those fees are going to go into the DAO as well. So it's a very unique model where the protocol is collecting on the protocol activity fees, but also from the fees outside of the protocol on application layer and sort of in real life as well. And I was thinking about the comparisons. We are in a sort of a place where we're not simply competing with other defy protocols that are,

very sort of small, they focus on small level innovation. But if you think about Uniswap and Unification Proposal, they were asking 120 million annual budget. That was the past couple of months ago. Sky is operating between 75, 90 million annualist budget, rain raised 250 million. So the way to think about funding is about what is the funding amount to run all the operations for the protocol,

development, innovation, research, application, security, product development across three different products, and at the same time being able to invest into growth. So effectively the proposal mainly is investment into product development, product research, but also growing applications and being able to compete at the same level as, for example, fintech today. So that's the sort of a level that we're looking for. And from sustainability perspective, that is possible as well. So that is kind of like an overall picture there. So it is a big trade of that we are giving up sort of a self-sustainable way to create revenue from the fees in the favor of putting all the fees to go into the benefit of the offer token,

and drawing that aspect. So one other concern that Mark raised was about how the foundation would be made truly independent. And what did what you propose for that? You know, what do you think would be the best way to find the right board members and administrators and make sure that it's not just sort of like an arm of labs or really any other entity in the AVE ecosystem? Yeah, it needs to be truly independent, but also besides independence, that's basically that has to be like the baseline. But it should be also in a position where it can actually enforce, for example, the trademark. So one of the challenges that the Avedao, for example, today has is that it doesn't have a legal entity,

which means kind of like that creates a lot of uncertainty for everyone that is contributing to voting, who is getting funding from the Dow and so forth. But the other sort of a challenge there is that when it comes to trademarks or branding, it's important to be able to enforce the branding because if it's not enforced, then anyone can use a brand and it loses its protection. So it has to be a combination of neutrality. And neutrality doesn't mean that basically that's, you know, there's arms linked to the AVA labs. It has to be arms linked to every single person in the Ava Dow.

Because one peculiar point about the AVE, the way the Avedo is structured is that there is service providers and these service providers are getting annual budgets from the DAO. but at the same time they're also kind of like active participants. So there's sort of an arnsling that needs to be coming from all of the angles there. And then the enforceability aspects. So that is important for us. But we're really happy about the idea of giving sort of a control of the brand in the benefit of the token holders because essentially that creates less certainty

and we notice that the less certainty there is, the easier it is to sort of understand where the value capture is going towards. And the big thing about the AVE will win proposal is that we want to ensure that we send an extremely strong signal that the value capture is going to the token-centric model and that is where we and the whole team are fully focused on.

So I also noticed a few comments around the request for 795,000 AVE tokens. You know, so Mark Zeller said, hey, you're requesting this amount, but we don't know how many DAO tokens, ABE Dow tokens the Labs already has. He also talked about an on-train analysis he did, showing that four wallets connected to Avey Labs seem to be voting to defeat a proposal that would require disclosures of wallet ownership and conflicts of interest, that proposal failed a few days ago. Were those four wallets that he identified?

Were those tied to ABE Labs? There was some wallets that were tied to me personally, not all of them. And so there's a lot of misinformation in our role going. And I think the problem wasn't really devoting itself. It was the conflict of interest topic is something that, we have addressed in certain ways and we have disclosure requirements on proposals. But also the way the proposal was written is that sort of every single wallet that you have, you have to docks your wallet if you get any sort of benefit from the Dow.

So it doesn't really, when you read the proposal, it doesn't really relate only to participants. It can be also users that are getting benefits. So the sort of a proposal was really rushed and done really quickly. And that is the reason why, for example, I voted no for that proposal. And I think I have all the right to vote no on things that I don't think are the best for the protocol. Or, for example, that maybe they're not ready in the current form. That doesn't mean that a framework will be passed in the future. and I think it's a topic that will evolve over time.

But that's the whole point of the token governance as well, is that if you have skin in the game, for example, if I bought it, I should be able to participate. And having skin in the game is actually really important because it also means that you have to make the decisions that really ensure that is benefit for the protocol. Yeah. So last couple of quick questions, just, you know, one to follow on that. So he suggested that any entity requesting Dow funding disclosed all their wallets. And then Defi Ignis said that he felt that the 75,000 AVE token grant should only be made if those tokens would not be used for voting. And I'm curious to hear what you thought of those two, you know, suggested tweaks.

Yeah, I think the first one is kind of a double-lit obviously to doxing, but I do think there's some sort of framework that could be applied that can improve maybe on the sort of like, you know, how service providers or contributors vote, as long as they have full right to vote. I truly believe in the token governance and having skin in the game. I think on the second point, I think that is very fair assessment. And I think that's something that from all the last perspective, we also commented that we won't be voting with those tokens.

Oh, okay. So last question about this. You know, more than one person also proposed that the various parts of the proposal, you know, the four that I mentioned, the revenue, the V4, the foundation, the $50 million funding request, that those be the. unbundles and, you know, voted on one at a time. What do you think of that suggestion? I think it breaks down the structure of the proposal because everything is tied

into whether V4 is approved as a direction. And if that's approved as a direction, then those revenue streams will actually apply there. And then there is obviously the question of the branding and that is sold in the same proposal. And if other labs is going to forego is 100% of this revenue for the benefit of the token holders, which I think is a really good idea and gets us into the stronger token-centric model. In that case, we have to be sure that we're able to, if we are asking a budget from the Dow, that we're able to then have sort of technology and a product that we can deliver on the features

and build more revenue into the Ava-Dal. So they're all kind of like connected in within the proposal. Yesterday you wrote a long essay that was all about, you know, solar power and defy and just about so many of the different kind of technological revolution and industrial revolutions we've seen in the past. I'm curious if you could just, you know, give a short recap of it for the audience so they know kind of what you're thinking about. Yeah, it boils down to the whole sort of. a vision that we need to get defy to grow. You know, 220 billion in total sort of a value in the ecosystem is amazing achievement over what we've done over the past years and proven with the protocols. But basically, we have to scale also beyond crypto assets. And to do that,

obviously, tokenization and RWAs play a big role there. But looking at the RWA space, I think I do believe that, for example, the traditional assets that are already somewhat traded in traditional venues or are already well established like, you know, T bills, money market funds and so forth, are going to get tokenized. It adds more transparency, more efficiency, and produces a lot of friction. So that corrects a lot of the cost structured issues that we have in traditional finance. But what I think is that a bigger opportunity for RWA is actually to tap into assets that are not necessarily traded is future proven assets. And I call them abundance assets. So currently a lot of our economy is based on scarcity assets.

So for example, mortgages are based on the fact that there's a scarce set of land. concentration of population and buildings and it's very hard to build. But in the future, we're going to have a lot of energy from solar. Energy costs will be a fraction of what it is today. We're going to have infinite amount of intelligence. We're going to have robotics. We're going to have 3D printing. And all these different technologies that are part of the abundance,

it means that every human basically have almost equal access to the same resources, and we can build things better. So scarcity no longer is the sort of a construction of our society. It's based on the abundance. So there's going to be this transition for the next three decades, where we can actually create and accelerate this abundance economy by funding these resources. and the biggest resources for us, what we learned is solar power. So being able to fund a lot of solar, which is capital expensive, but operational cost low,

we'll be able to tokenize that asset, uses a collateral in RV4, and then expand and move faster in the adoption. And with the economies of scale, it becomes more cheaper over time because there's more and more construction on solar. and the same thing applies to batteries and other abundance technologies. So that's the kind of idea of like how, you know, we could tap into this sort of 30, 50 trillion markets with these abundance assets that are future-proof and then use that as an infrastructure for AVE and then distribute that yield across all the AVE users through AVE app, AVEPRO,

and then Ava kit to the Fintex. So it is sort of a bigger vision more for a long term to think about where does the new collateral come in DFI? Because DFI has this sort of demand side of collateral problem that can be solved by tokenizing a lot of these abundance assets. Yeah, yeah, I thought it was really interesting. All right, well, we're at time. But it was so great to hear from you about the Avey-Will Win proposal, to hear you address some of the, you know, criticisms and comments and tweaks being suggested by the community.

And I look forward to seeing what happens with that. So thank you so much, Stani, for joining the show. Thank you so much in Defyre, because Define has this sort of demand side of collateral problem that can be solved by tokenizing a lot of these abundance assets. Yeah, yeah, I thought it was really interesting. All right, well, where is the problem? time, but it was so great to hear from you about the Avi Will Win proposal, to hear you address

some of the, you know, criticisms and comments and tweaks being suggested by the community. And I look forward to seeing what happens with that. So thank you so much, Stani, for joining the show. Thank you so much.