BGD Labs Ends Collaboration with Aave Over Centralization Concerns

BGD Labs ends collaboration with Aave over centralization concerns.

BGD Labs, a key technical developer for the Aave lending DeFi platform, announced it will cease collaboration with the project due to “radical changes” in the structure of the DAO.

The current agreement between the parties concludes on April 1.

Founded in 2022, BGD Labs played a central role in building and maintaining Aave’s infrastructure. BGD Labs led the development of the Aave v3 protocol, which it described as the “jewel” of the ecosystem, governance structure, and the Umbrella security module.

According to the company’s statement, the main systems of the DeFi platform are currently in a “very reliable and promising state” and can operate indefinitely without significant changes.

BGD Labs announced plans to publish documentation and maintenance guides to assist other participants in assuming these responsibilities.

The company explained its decision to end the collaboration due to an “asymmetric organizational scenario” being implemented by Aave Labs, which threatens centralization. The startup, originally behind the DeFi project, is seeking to regain full control over it:

• transitioned from an independent company to a central developer of the v4 protocol;
• took control of the brand and communications, securing the majority of votes in governance for crucial decisions;
• criticizes Aave v3 to promote version v4;
• ceased collaboration on protocol development, expecting others to contribute “for free”;
• plans to end support for v3 and forcibly migrate users to the new version.

BGD Labs are rage quitting Aave DAO after 4 years.

They built Aave v3, governance infra, Umbrella, and most core systems.

Why they’re leaving:

— Aave Labs pivoted from independent company to central contributor pushing v4
— Aave Labs controls the brand, comms, and has voting… pic.twitter.com/MqRR105eEK

— Ignas | DeFi (@DefiIgnas) February 20, 2026

“A sad outcome for Aave DAO,” commented DeFi researcher known as Ignas.

According to DeFiLlama, the platform maintains a leading position in the decentralized finance segment with a TVL of $25.79 billion. Lido and Eigen, in second and third place, have figures of $18.34 billion and $9.16 billion, respectively.

The AAVE token has depreciated by more than 5% in the last 24 hours. The asset is trading around $117, approximately 82% below its all-time high of $661 recorded in November 2020.

In February, media reported that Aave founder Stani Kulechov purchased a five-story Victorian mansion in the prestigious Notting Hill area of London for £22 million (about $30 million).