Aave Labs proposes Cayman foundation to hold brand and IP for DAO

On October 2, 2026, development firm Aave Labs proposed establishing a memberless foundation in the Cayman Islands to hold the Aave brand and intellectual property for the Aave DAO. The proposal, which follows commitments in the February 2026 'Aave Will Win Framework,' aims to resolve long-running tensions over revenue and asset control. Phase 1 focuses solely on incorporation and appointing independent officers, while actual trademark and codebase transfers are deferred to future DAO votes.

Scope of the Phase 1 proposal

• ▪Phase 1 of the Aave Labs proposal covers only incorporating the Cayman Islands foundation, appointing an independent director and supervisor, and funding legal and setup costs, without transferring any assets
• ▪The actual transfer of the Aave trademark, primary domains, and codebase intellectual property to the Cayman Islands foundation proposed by Aave Labs is deferred to future, separate Aave Improvement Proposals
• ▪On October 2, 2026, development firm Aave Labs submitted a governance proposal titled "[ARFC] The Aave Foundation, Phase 1" to establish a memberless foundation in the Cayman Islands

Structure and governance of the foundation

• ▪The Aave foundation proposed by Aave Labs would be set up under the Cayman Islands Foundation Companies Act as a memberless foundation with no owning members or shareholders
• ▪The Cayman Islands foundation proposed by Aave Labs would be required to submit quarterly reports to the Aave governance forum covering the foundation's assets and legal activities
• ▪Under Aave Labs' proposal, Aave Labs, its affiliates, and service providers are explicitly barred from holding any roles or rights within the Cayman Islands foundation proposed by Aave Labs

Transfer of intellectual property

• ▪If the Aave trademark and codebase intellectual property are transferred, Aave Labs would no longer be the legal owner of the protocol's identity, giving the Aave DAO formal control
• ▪The Cayman Islands foundation proposed by Aave Labs on October 2, 2026 would eventually hold legal title to the Aave trademark, primary domains, protocol codebase, and other intellectual property for the benefit of the Aave Protocol

Debatable claims

• ▪Giving the DAO control over Aave's IP will hinder the protocol's development
• ▪Aave DAO should establish a Cayman Islands foundation to hold its intellectual property
• ▪Excluding Aave Labs from the new foundation is necessary to protect DAO autonomy
• ▪Transferring intellectual property to a foundation is necessary for Aave's decentralization