The native token of the decentralized lending protocol Aave, AAVE, has fallen to a nearly two-year low. The price drop occurred as Chaos Labs, one of the protocol's two risk management operators, announced its departure from the Aave DAO. This exit follows a series of other core contributor departures.
Chaos Labs founder Omer Goldberg stated the decision was not made lightly, citing an expanded risk scope with the launch of Aave V4 and operational losses. The firm reportedly turned down an offer to nearly double its annual fee. With Chaos Labs stepping down, LlamaRisk becomes the sole risk manager for Aave. Aave Labs, the protocol's development team, will provide engineering and analytical support to ensure a smooth transition.
Despite the recent V4 protocol launch, which introduced new borrowing and lending functionalities, the V3 protocol remains more active. The Aave protocol, currently holding over $24 billion in total value locked, has seen significant user growth, reaching an all-time high of approximately 155,000 active users in February.