BGD Labs stated it will be quitting the DAO after four years of work because the organization had changed and it was taking a “adversarial position” to its liquidity protocol.
BGD Labs, a key technical contributor to the decentralised finance protocol Aave, says it will end its work with the project’s DAO on April 1, after four years.
In a post on the AAVE forum on Friday, BGD talked about an “asymmetric organisational scenario” that the DAO had “badly executed” without taking into account the skills of its participants. The contributor also said that Aave had taken an “adversarial position” on the third version (v3) of their protocol to promote features in the fourth version (v4).
“While all of the previous points say that BGD should only work on v3, the situation makes no sense to us: every time we think about making v3 better, there will be some kind of implicit or explicit artificial constraint,” said BGD. “We don’t really want to be in that position because we think it’s a waste of our potential.”
Community reaction and governance concerns
BGD indicated that “nothing changes” until April 1 as part of the end of its partnership with Aave. The project will still work on v3, Umbrella, chain expansions, security, and onboarding assets.
BGD stated there wasn’t a “direct off-boarding path” for the project to contribute to the Aave protocol, but existing projects that are likely to survive after its contributions finish will have maintenance standards. It suggested a $200,000 security retainer for two months for the community to think about after April, while Aave looks for a new leader.
The forum post added, BGD Labs was started in early 2022 to build in the DeFi/web3 ecosystem.” Since then, we have primarily concentrated on our work on Aave. For every technical sub-system of Aave that the community knows about, BGD Labs was in charge of its development or at least worked with other groups on it.
People using Aave react to BGD’s departure
Many users reacted positively to the news of BGD, but many also expressed anxiety about losing a major contributor to the DeFi protocol.
If independent contributors feel left out by DAO-level centralisation, maybe the answer is just to make the structure of the DAO clearer, remarked user Josue Mpia. This issue appears to be more significant than the departure of a single team.
Some people blamed Aave founder and CEO Stani Kulechov for the project’s exit. The CEO also replied to the message, saying lovely things about BGD’s role:
I understand BGD’s choice, but I’m sad to see them go. It’s good for the DeFi ecosystem to have a team like BGD in it. I hope they keep building and adding to the industry.