Aave Labs submitted an ARFC titled “[ARFC] The Aave Foundation, Phase 1,” proposing to create a memberless foundation in the Cayman Islands that would be overseen by the Aave DAO. Phase 1 is narrowly scoped: it would incorporate the foundation and appoint independent directors, a supervisor and a secretary. No trademarks, primary domains or protocol codebase IP would move now; each such transfer would require its own separate Aave Improvement Proposal (AIP) and governance vote. The filing explicitly bars Aave Labs and DAO service providers from serving in foundation roles.
Funding in Phase 1 is limited to incorporation, legal and appointment costs with no recurring budget; the DAO would cover reasonable registration and legal fees. The foundation would publish quarterly reports detailing assets held, operating expenses and related legal activity. The proposal is framed as a follow‑through to the February “Aave Will Win Framework” and addresses long‑running friction between Aave Labs and the DAO around revenue flows and asset control, which intensified in late 2025.
If the community reaches consensus on the ARFC, the process would proceed to snapshot and then to an AIP authorizing the necessary registration and appointment fees. Company registration in the Cayman Islands and appointment of independent officers would follow, after which separate AIPs could be submitted to transfer trademarks, domains and codebase IP to the foundation — each a distinct governance decision and transparency checkpoint for the DAO.