AAVE Rallies 21% as Aave DAO Announces ‘Most Significant’ Governance Plan

Aave DAO Introduces Major Economic Overhaul, AAVE Jumps 21%

Aave DAO has unveiled a transformative proposal aimed at strengthening the platform’s financial ecosystem, driving AAVE token value, and rewarding long-term participants. The announcement follows a 115% increase in Aave’s treasury to $115 million since mid-2024 and the growth of its GHO stablecoin supply to $200 million.

Following the news, AAVE surged 21% in the past 24 hours, outpacing the broader market’s 3.5% gain, as measured by the CoinDesk 20 (CD20) index.

The Key Changes in Aave’s “Aavenomics” Update

• Increased Staking Rewards: Aave plans to enhance profit-sharing mechanisms for users staking AAVE, reinforcing its value proposition.
• Anti-GHO Token: This new non-tradable asset can be used to offset GHO debt or be staked as StkGHO for additional rewards. Half of GHO’s $12 million annual revenue will fund this system.
• $1 Million Weekly Buyback Plan: The DAO intends to repurchase AAVE tokens weekly to stabilize its price and reward holders, with a potential expansion in six months.
• “Umbrella” Market Protection: Aave is introducing a self-protection mechanism to shield users from market downturns and bad debt, a feature that distinguishes it from competitors.

Marc “Billy” Zeller, a key Aave contributor, emphasized the proposal’s significance, calling it the most important update in Aave’s history. The initiative is now open for community discussion, with an official vote expected in the coming weeks.