Aave Team Raises Concerns Over Previous Performance: Received $86 Million in Funding, Holds 23% of Tokens, All Six Products Have Failed or Lost Money

On February 25th, Marc Zeller—founder of Aave ecosystem contributor ACI—published a public report disclosing that Aave Labs has secured roughly $86 million in cumulative capital backing since 2017, including proceeds from its 2017 ICO, venture capital (VC) funding, and direct grants from the Aave DAO. The founding team set aside 23% of LEND tokens during the 2017 ICO; those tokens later migrated to AAVE at a 100:1 ratio. Prior to receiving DAO funding, Labs held approximately $48.7 million in capital. Since then, it has secured ~$37.4 million in DAO grants and is now seeking an additional $51 million via the “Aave Will Win” proposal. The report raises critical questions about Labs’ past product performance, noting that six independent products launched alongside the core Aave protocol have either failed outright or failed to become profitable. For the real-world asset (RWA) project Horizon: while it once claimed to have exceeded $1 billion in scale, its actual RWA collateral totals just ~$135 million—most concentrated in a single asset. Since launching in August 2025, Horizon has generated ~$216,000 in cumulative revenue for the DAO, but its incentive and related costs total ~$5.25 million, resulting in an input-output ratio of roughly 24:1. Key core developers behind Aave V1, V2, and V3.0 left Labs between 2021 and 2022. V3.0 is widely viewed as the last major protocol version led by Labs; subsequent iterations have been primarily driven by DAO service providers. In related governance votes, a single large delegation address played a pivotal role in approving the Horizon proposal, sparking community debates about governance centralization and fund utilization efficiency. This controversy emerges as the Aave community deliberates a new $17.5 million product growth grant proposal. Discussions around fund allocation, performance disclosure, and governance transparency are heating up further.