Aave DAO Rejects Plan To List Token Linked to RWA Initiative

Token holders of Aave, the second-largest decentralized finance (DeFi) protocol by total value locked (TVL), rejected a proposal to list a token linked to its real-world assets (RWA) initiative Horizon.

Aave’s founder, Stani Kulechov, said in an X post that community consensus would be respected.

“Overall consensus across the Aave DAO is that there is no interest on other tokens,” Kulechov wrote. “The consensus will be respected, Aave DAO is a real DAO. RWA exploration will continue once a right approach is found. There is only $AAVE.”

Horizon Initiative

In a Mar. 13 proposal, Aave Labs, the company behind the lending protocol Aave, announced its plans to launch an RWA-focused initiative called Horizon.

According to the proposal, Horizon would integrate RWA into DeFi, allowing institutional investors to use tokenized money market funds (MMFs) as collateral to borrow USDC and GHO on Aave.

The proposal also included a plan to launch a Horizon token, with 15% of its total supply allocated to the Aave DAO. 10% would be allocated to the Aave DAO treasury, 3% for ecosystem incentives, and 2% airdropped to Staked Aave holders.

The Aave community strongly opposed the proposal, with about half of the 90+ comments under the post speaking against it.

Community members said introducing a second token could dilute $AAVE’s utility and governance power. Some argued that fragmented token models in other DeFi projects had led to reduced investor confidence and governance inefficiencies. By rejecting the Horizon token, Aave’s community reaffirmed its commitment to maintaining a unified ecosystem where $AAVE remains the sole driver of governance and incentives.

Aavechan founder Marc Zeller said, “There’s only one token in the Aave ecosystem; its ticker is $AAVE.”