Why is Aave’s new governance proposal called “the most important proposal in Aave’s history”?

Aave’s new governance proposal is called “the most important proposal in Aave’s history” for many reasons. First, the income redistribution mechanism in the proposal is of great significance. It plans to distribute part of the agreement income to the stkAAVE pledgee, redistribute the excess income through the "fee switch", change the previous model of only the treasury in which the income is stored in the treasury, and closely link the success of the agreement with the interests of the holders.

Secondly, the AAVE token repurchase and distribution plan has far-reaching impact. Over the next six months, $1 million is invested per week to repurchase tokens, which are supervised by the newly established AFC. Repurchase tokens are used for ecological reserves and support long-term development. As new revenue sources expand, the repurchase budget may increase.

Furthermore, Umbrella security mechanism is crucial. It integrates staking and liquidity management, can effectively prevent bad debt risks and liquidity crises, provides strong bad debt protection for Aave, attracts institutional-level users, and will also be deployed across multiple blockchain networks.

Then, the retirement of LEND tokens cannot be ignored. The proposal plans to freeze the LEND migration contract, end its history as the original governance token, recycle unchanged AAVE tokens, clear governance legacy issues, and enhance financial strength.

The establishment of the Aave Finance Committee is also critical. AFC comprehensively manages the fund bank and liquidity strategies, supervises financial allocation, formulates and implements liquidity strategies, evaluates and manages financial risks, and is supported by professional institutions to move towards professional and transparent financial management.

The adjustment of the agreement revenue distribution mechanism has attracted much attention. Introduce the "fee switch", cancel the GHO fee discount, adopt profit distribution based on agreement income, and also introduce the Anti-GHO incentive mechanism to link income and incentives to avoid the defects of rate discounts.

Anti - GHO mechanism is unique. 50% of GHO fees generate Anti-GHO, 80% is distributed to StkAAVE holders and 20% is distributed to StkBPT holders. Holders can burn to offset GHO debt or convert to StkGHO to obtain pledge proceeds.

Judging from community feedback, although the proposal is collected, community members calculate that AAVE holders are expected to receive an annualized income of about 3%. Aave has a stable position in the DeFi ecosystem, similar to traditional financial blue chip stocks, attracting rational investors.

In addition, the relevant White House policies are good for Aave. AI and cryptocurrency directors said it could revoke the “DeFi broker rules” to relieve regulatory pressure and create a more favorable environment for Aave’s development. Based on the above points, Aave's new governance proposal is well deserved to be called "the most important proposal in Aave's history."