Aave Unveils Major Tokenomics Overhaul: Token Buyback & Enhanced Security System!

Jakarta, Pintu News – According to BeInCrypto, the Aave Chan Initiative (ACI), led by Marc Zeller, has submitted a new proposal aimed at revamping tokenomics, revenue distribution, and liquidity management within the Aave protocol.

This Aave Request for Comment (ARFC) proposal follows the successful approval of the TEMP CHECK stage by the community, signaling strong support for these transformative changes.

Aave Announces a Major Overhaul of Tokenomics!

In a recent post on X (formerly Twitter), Marc Zeller stated that Aavenomics’ latest proposal is the result of five years of development.

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“We consider this the most important proposal in our history. Please read it and give us your feedback,” said Zeller.

This proposal introduces the creation of the Aave Finance Committee (AFC), a new body tasked with overseeing treasury operations. The AFC will lead the “Buy and Distribute” program, which aims to buy back and distribute AAVE tokens.

Through this program, AFC will buy back AAVE tokens from the secondary market at a rate of $1 million per week for the first six months. After that period, the buyback rate will be re-evaluated and potentially increased depending on the financial condition of the protocol.

“This is big news! Buybacks will reduce the supply of AAVE in circulation, making the token more rare and valuable. The activation of the fee mechanism will also create a new source of revenue for the protocol as well as increase demand,” wrote one user.

Major Changes Related to AAVE Stakers

Another significant change relates to AAVE stakers. This proposal removes the risk of slashing for those staking in StkBPT, providing relief for participants.

However, this change was also accompanied by a gradual reduction in StkBPT incentives, as Aave moved to a hybrid model that favored liquidity incentives over traditional staking rewards.

This proposal also closes the LEND to AAVE migration contract. As such, 320,000 AAVE tokens-worth about $65 million-will be transferred back to the ecosystem’s reserves.

This move marks the end of a transition that lasted nearly five years, in line with Aave’s strategy of focusing on real revenue rather than inflationary token issuance.

Aave’s New Features: Anti-GHO & Umbrella Mechanism to Increase Stability!

One of the main elements in this update is Anti-GHO, a non-tradable ERC20 token that will replace the existing discount mechanism. Anti-GHO has two main functions.

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First, holders can burn these tokens in a 1:1 ratio to offset GHO borrowing costs, thus acting as a discounting mechanism. Secondly, through the Merit system, users can convert Anti-GHO into StkGHO, which can later be redeemed as GHO after the cooldown period ends.

To support this program, Aave has allocated 50% of GHO revenue, which is estimated at $6 million per year. Of this, 80% will go to AAVE stakers, while the remaining 20% is allocated to StkBPT holders.

In addition, the proposal also introduces the Umbrella mechanism, which is designed to protect users from bad debt as well as strengthen liquidity across various networks. With this system, surplus revenue from the DAO will be used to incentivize Umbrella aToken stakers.

In the initial stage, the mechanism will focus on protecting key assets such as wETH, USDC, USDT, and GHO, with plans to expand to other assets in the future.

This proposal is now open for community feedback before going to the Snapshot vote stage. If approved, implementation will take place through an Aave Improvement Proposal (AIP), which will be the first step in rolling out these new features.

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Reference:

• BeInCrypto. Aave Tokenomics: Major Update. Accessed on March 6, 2025
• Cointelegraph. Aave Revamp Includes Revenue Redistribution, Umbrella Safety System. Accessed on March 6, 2025