Aave Labs moves to place protocol IP under community-controlled foundation

Aave Labs has proposed creating the Aave Foundation, a Cayman Islands foundation company designed to hold and protect the protocol’s trademarks, domains and intellectual property on behalf of the Aave ecosystem.

The proposal, currently at the ARFC stage, covers only the first phase of the plan. It would authorize the incorporation of the entity and the appointment of an independent director, supervisor and secretary.

Later phases would separately seek governance approval to transfer the Aave trademark, primary domains and protocol codebase intellectual property to the foundation.

Aave Labs said the structure is intended to solve a longstanding problem for the DAO: while governance has funded software, risk tooling, models and documentation through service providers, ownership of that work has been handled inconsistently and sometimes remains with the provider that created it.

The Aave trademark and primary domains also currently sit outside DAO control, according to the proposal.

Because a DAO itself cannot register trademarks, hold domains or bring legal actions to protect intellectual property, the proposed foundation would act as the legal owner of those assets while remaining memberless, with no shareholders or owners sitting above the protocol.

The foundation’s stated role would be limited to holding, protecting and licensing intellectual property for the benefit of Aave.

Aave Labs and other DAO service providers would not be able to appoint directors or supervisors and would be prohibited from serving in those roles. Future directors could only be appointed or removed through an Aave Improvement Proposal.

The DAO would retain control over protocol decisions including listings, parameter changes, budgets, service-provider engagements and framework amendments.

It would also retain consent rights over changes to the foundation’s constitution, disposal of core intellectual property, mergers and restructurings, while governance could direct the foundation to wind down and transfer its remaining assets to a successor vehicle.

The proposal does not request a recurring operating budget. Phase 1 would cover reasonable incorporation costs, legal expenses and fees associated with appointing the initial director, supervisor and secretary. Any additional funding would require a separate governance proposal.

The foundation would publish quarterly reports covering the assets it holds, changes in ownership, operating expenses and any legal actions taken to protect Aave trademarks or code.

If the ARFC receives sufficient community support, it would move to a Snapshot vote followed by an onchain AIP. The entity would then be incorporated in the Cayman Islands before the proposed trademark, domain and codebase transfers begin.

Aave Labs said the structure forms part of its broader Aave Will Win framework and is intended to create a community-controlled legal vehicle for assets associated with the protocol while keeping governance authority with AAVE tokenholders.