- Gauntlet ends four-year partnership with Aave due to DAO governance issues.
- Gauntlet was Aave’s risk manager.
- Aave now faces the task of finding a new risk manager following Gauntlet’s withdrawal.
Gauntlet, a prominent blockchain risk management company, announced a four-year agreement with Aave, a leading decentralized lending platform managed by Aave Companies, which recently rebranded as Avara, according to an announcement by Gauntlet co-founder John Morrow in an Aave forum post. Partnership has ended. .
Gauntlet’s decision due to governance issues within Aave’s Decentralized Autonomous Organization (DAO) marks the end of collaboration to improve the safety and efficiency of the platform.
DAO governance dispute
Gauntlet’s role as Aave’s risk manager included monitoring and analyzing protocol parameters to ensure the security of the platform.
But navigating the inconsistent guidance and goals of Aave’s biggest stakeholders has become increasingly difficult over the past year, according to Gauntlet co-founder John Morrow. Despite Gauntlet’s efforts to contribute to Aave’s growth, the partnership eventually dissolved due to unresolved governance issues within the DAO structure.
Implications for Aave
As one of the largest decentralized lending platforms, Aave relies on its community of token holders to vote to make important decisions. The end of Gauntlet’s partnership highlights the challenges inherent in decentralized governance, particularly in managing expectations and aligning goals across stakeholders.
With Gauntlet stepping down from its risk manager role, Aave is now faced with the task of finding a suitable replacement to meet its risk management requirements.
The announcement prompted mixed reactions within the Aave community, with some expressing disappointment over the breakdown in trust between Aave and Gauntlet. Ernesto Boado, former CTO of Aave, expressed concern about ending the partnership mid-contract.
This development sparks reflection on how DAOs and partners collaborate, negotiate, and manage expectations in the rapidly evolving DeFi ecosystem. Going forward, stakeholders can seek to establish clearer communication channels and governance frameworks to prevent similar disputes and ensure the long-term sustainability of decentralized platforms like Aave.