A major conflict inside the Aave ecosystem has taken a serious turn after a core developer announced it will step away from the project. The move comes during a heated dispute over plans to shift users from the current Aave v3 platform to the upcoming v4 upgrade.
Software firm Bored Ghosts Developing (BGD), which helps build and maintain Aave’s core systems, said it will not renew its contract when it expires on April 1. The company made the announcement in Aave’s governance forum, blaming disagreements with Aave Labs over the project’s direction.
BGD said it could not continue supporting Aave v3 while there were efforts to push users toward v4. The team called the idea of changing the current system “borderline outrageous,” warning that Aave v3 is still fully functional and generates most of the platform’s revenue.
The market reacted quickly to the news. The AAVE token dropped more than 6% shortly after the announcement. The reaction showed growing investor concern about instability inside one of crypto’s biggest decentralized finance platforms.
Aave founder Stani Kulechov acknowledged BGD’s departure and praised the team’s contributions. He said Aave v3 would not be where it is today without their work. BGD co-founder Ernesto Boado previously served as chief technology officer at Aave Labs, highlighting how closely connected the teams have been.
Community leaders also raised concerns. Aave delegate Marc Zeller called the situation “devastating,” warning that much of Aave’s revenue depends on systems built by BGD. The dispute is also tied to wider tensions between Aave DAO and Aave Labs over control, branding, and future strategy.
Despite the conflict, Aave Labs said there is no immediate plan to force users to migrate to v4. The company confirmed that v3 will remain supported and said it can take over maintenance if needed. Aave currently holds more than $26 billion in user deposits, making it the largest lending protocol in DeFi.
In separate news, the US Securities and Exchange Commission has officially ended its investigation into Aave without taking enforcement action. This closes nearly four years of regulatory uncertainty, but the internal governance battle now presents a new challenge for the platform’s future.
