AAVE soars 13% as buyback proposal passes among tokenholders

Aave’s tokenholders approved a governance connection to commencement buying backmost the decentralized concern (DeFi) protocol’s governance token, AAVE, arsenic portion of a broader tokenomics overhaul, Aave said connected April 9. 

The proposal — which was approved by much than 99% of AAVE tokenholders — permits the protocol to acquisition $4 cardinal successful AAVE (AAVE) tokens, capable for 1 period of buybacks. 

The determination is simply a “first step” toward a broader program to repurchase $1 cardinal AAVE tokens play for six months. It is besides the latest lawsuit of DeFi protocols implementing buyback mechanisms successful effect to tokenholder demands.

“The extremity is to sustainably summation AAVE acquisition from the unfastened marketplace and administer it to the Ecosystem Reserve,” the connection said. 

The AAVE token’s terms rallied much than 13% connected April 9, bringing the protocol’s marketplace capitalization to much than $2.1 billion, according to data from CoinGecko.

The buyback connection passed with overwhelming support. Source: Aave

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Buybacks summation popularity

In March, the Aave Chan Initiative (ACI), a governance advisory group, proposed a tokenomics revamp that would see caller gross allocations for AAVE tokenholders, enhanced information features for users, and the instauration of an “Aave Finance Committee.”

Aave is Web3’s astir fashionable DeFi protocol, with full worth locked surpassing $17.5 cardinal arsenic of April 9, according to DefiLlama. 

It is besides among DeFi’s biggest interest generators, with an estimated annualized interest income of $350 million, the information shows. 

Aave is DeFi’s astir fashionable protocol by TVL. Source: DeFILlama

DeFi protocols are nether expanding unit to supply tokenholders with a stock of protocol revenues — partially due to the fact that US President Donald Trump has fostered a friendlier regulatory situation for DeFi protocols successful the United States.

Projects including Ethena, Ether.fi and Maple are piloting value-accrual mechanisms for their autochthonal tokens.

In January, Maple Finance’s assemblage floated buying backmost autochthonal SYRUP tokens and distributing them arsenic rewards to stakers.

In December, Ether.fi, a liquid restaking token issuer, tipped plans to nonstop 5% of protocol revenues toward buying backmost autochthonal ETHFI tokens. 

Similarly, Ethena, a yield-bearing stablecoin issuer, agreed to stock some of its astir $200 cardinal successful protocol revenues with tokenholders successful November.

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