Aave DAO Rejects Creation of a New Token for its Horizon Initiative

This decision, announced by Aave Labs founder Stani Kulechov, reflects the DAO’s commitment to preserving the value and utility of its existing AAVE token.

The Aave DAO has decided not to create a new token for its Horizon initiative, which aims to integrate real-world assets (RWAs) into DeFi, with a focus on institutional participation.

This decision, announced by Aave Labs founder Stani Kulechov, follows concerns raised by community members about the potential dilution of the AAVE token and a shift in focus away from its role as the sole governance and utility token.

The Horizon initiative, proposed by Aave Labs and approved by the Aave DAO in July, aims to bring institutional-grade RWA products to the Aave ecosystem. The initiative will enable institutions to use tokenized money market funds as collateral for borrowing stablecoins, aligning with institutional compliance standards.

The initial proposal for Horizon included a clause suggesting the creation of a new token, which would generate revenue for the Aave DAO. However, this suggestion sparked debate among community members.

Prominent voices within the community, such as Marc Zeller of the Aave Chan Initiative, expressed opposition to the proposal, which they felt would diminish the AAVE token and shift the focus of the DAO.

In response to these concerns, Kulechov clarified that the Aave DAO had no interest in introducing additional tokens. He emphasized that the developers would respect the DAO’s consensus.

"There is only $AAVE," stated Kulechov.

This decision by the Aave DAO to reject the creation of a new token has been widely praised by the community as a demonstration of Aave’s commitment to decentralized decision-making and its respect for the concerns of its users.

The world of RWAs is surging, and Aave Labs has its sights set on this booming sector. The numbers from RWA.xyz reveal the rapid expansion in the past month.

The total value of on-chain RWAs has soared by over 17%, reaching an impressive $18.13 billion. Additionally, unique asset holders have increased by 5%, surpassing 89,818.

While the rejection of a new token is a significant moment, the Horizon initiative remains a priority for Aave Labs. The team will be revisiting its approach to RWAs to ensure alignment with the DAO’s strategic direction.

As the largest decentralized lending protocol, Aave continues to innovate while staying true to its core principles of decentralization and community-driven governance.output: TL;DRThe Aave DAO has decided not to create a new token for its Horizon initiative, which aims to integrate real-world assets (RWAs) into DeFi, with a focus on institutional participation. This decision follows concerns raised by community members about the potential dilution of the AAVE token and a shift in focus away from its role as the sole governance and utility token. The Horizon initiative, proposed by Aave Labs and approved by the Aave DAO in July, will bring institutional-grade RWA products to the Aave ecosystem. The initiative will enable institutions to use tokenized money market funds as collateral for borrowing stablecoins, aligning with institutional compliance standards. The initial proposal for Horizon included a clause suggesting the creation of a new token, which would generate revenue for the Aave DAO. However, this suggestion sparked concern among community members, who feared that it could lead to the dilution of the AAVE token and shift the focus of the DAO. Prominent voices within the community, such as Marc Zeller of the Aave Chan Initiative, expressed opposition to the proposal. In response to these concerns, Kulechov clarified that the Aave DAO had no interest in introducing additional tokens. He emphasized that the developers would respect the DAO’s consensus. "There is only $AAVE," stated Kulechov. This decision by the Aave DAO to reject the creation of a new token has been widely praised by the community as a demonstration of Aave’s commitment to decentralized decision-making and its respect for the concerns of its users. The world of RWAs is surging, and Aave Labs has its sights set on this booming sector. The numbers from RWA.xyz reveal the rapid expansion in the past month. The total value of on-chain RWAs has soared by over 17%, reaching an impressive $18.13 billion. Additionally, unique asset holders have increased by 5%, surpassing 89,818. While the rejection of a new token is a pivotal moment, the Horizon initiative remains a priority for Aave Labs. The team will be revisiting its approach to RWAs to ensure alignment with the DAO’s strategic direction. As the largest decentralized lending protocol, Aave continues to innovate while staying true to its core principles of decentralization and community-driven governance.