Article source: Techub News
Author: Yangz, Techub News
Recently, Marc Zeller, founder of the Aave Chan Initiative (ACI), initiated a community proposal to adjust the risk parameters of Aave V2 and V3 on Polygon, and explicitly "encourage migration from Polygon." As the application with the highest TVL on Polygon (DeFillama data shows that at the time of writing, Polygon's total TVL was approximately US$1.21 billion, of which approximately US$450 million was provided by Aave), Aave's move immediately attracted industry attention and also triggered a verbal dispute between the Polygon team and the Aave team.
Polygon co-founder Sandeep Nailwal accused Aave's leadership of 'sour grapes', stating that 'this behavior is extremely monopolistic and anti-competitive, and goes against the spirit of Web3.' In response, Aave founder Stani Kulechov stated that Polygon's behavior is indeed 'the villain crying out first', quickly spreading rumors and 'shifting the blame' to Aave's leadership in the face of general user opposition.
So, what is the root of this sudden argument? The reason stems from a Pre-PIP improvement proposal released by the Polygon community.
On December 12, Allez Labs, in collaboration with DeFi protocols Morpho and Yearn, drafted this proposal. The proposal states that there are approximately $1.3 billion in stablecoin reserves (DAI, USDC, and USDT) idling on the Polygon PoS cross-chain bridge, which translates to an estimated annual loss of about $70 million in yield based on current benchmark lending rates. Therefore, the three parties propose to deploy these stablecoin reserves into various yield strategy lending protocols and launch a new ecological incentive program to expand the DeFi ecosystem of Polygon PoS and AggLayer.
Specifically, the proposal suggests converting DAI into Maker's sUSDS and depositing USDC and USDT into Morpho Vaults to earn yield. Additionally, Allez Labs will act as risk managers to conduct risk analysis on other potential Morpho Vaults. Yearn will serve as the manager of the ecological incentive program, creating a Polygon ecological Yearn Vault for each approved asset and rewarding the depositors of these Vaults with yields generated from the Morpho market and sUSDS strategy.
At first glance, this proposal seems to have no issues. However, from Aave's leadership perspective, there are 'huge risks' hidden beneath this proposal. On the surface, as reflected in various examples quoted by Marc Zeller regarding the historical losses caused by cross-chain bridge vulnerabilities to the DeFi ecosystem, this proposal poses financial security risks for Aave. Secondly, as everyone can see, the initiators of this proposal are the three main beneficiaries of it. As the top application in the Polygon ecosystem's TVL ranking, Aave may feel the taste of being 'ignored' or 'betrayed'.
In addition, Stani Kulechov pointed out in his response that this proposal is actually the result of a 'dark collaboration' between Polygon and the three parties mentioned above, and there are reports that Polygon has completed a large token transaction as a result. Stani Kulechov stated that Polygon users have expressed dissatisfaction with this proposal from the very beginning, and only today did the Polygon leadership hypocritically claim that they also do not support the proposal, merely 'fabricating excuses'. In order to protect user asset security, Aave DAO proposed to 'exit Polygon'.
However, this proposal aimed at 'protecting user safety' is seen by Polygon as 'sour grapes'. Polygon co-founder Sandeep Nailwal stated in response to this matter that when this preliminary proposal was first submitted for discussion, Aave's leadership had lobbied vigorously to ensure that cross-chain funds would be deployed on Aave. During the public solicitation for proposals on Polygon's governance portal, Aave's leadership also held multiple meetings and invited the leadership of Polygon Labs to various dinners and presentations to gain their support, and 'chose Aave' as a stakeholder in the cross-chain process. Moreover, Aave also released related proposals, which did not attract widespread discussion in the Polygon community. In contrast, the proposal from Morpho (Aave's main competitor) received more support from community members.
Nailwal stated that Aave 'ignores the safety measures already in place, more like saying 'sour grapes' when they can't have them. Ironically, this move would harm the users it claims to protect, undermining their access to a stable and prosperous DeFi ecosystem. Claiming to care about user safety while trying to destabilize an ecosystem that so many users rely on is hypocritical.'
In addition to discussing security aspects, the verbal sparring between the two parties has escalated to attacks on various governance forms. Polygon Labs CEO Marc Boiron pointed out that Aave and its surrounding teams are 'monopolistic enterprises' and use dirty tactics to create fear. Boiron stated that Marc Zeller sent him a private message yesterday, 'trying to intimidate' him by saying that Aave DAO would definitely pass the proposal to 'exit Polygon'. Meanwhile, Stani Kulechov stated that Aave DAO is merely initiating discussions and taking action to protect users, 'labeling Aave DAO's proposal as anti-competitive behavior is inaccurate and diverts attention from the real issue, which is user safety.' Stani Kulechov remarked, 'Aave supports immutable governance. Aave even allows the use of project tokens for governance under a friendly fork policy. (In contrast), if Polygon wishes to have more control over cross-chain asset investment strategies, they could completely launch a tailored market.'
Currently, it appears that the proposal initiated by Allez Labs, Morpho, and Yearn is unlikely to pass, and whether Aave will truly exit the Polygon ecosystem remains uncertain (note that Lido has announced it will gradually shut down its staking services on Polygon). While this dispute will soon pass, the underlying issues are worth reflecting on. Without considering whether there are false statements from either side, both Aave's risk prevention and Polygon's ecosystem expansion are striving for maximum benefits for themselves and their users. So, in this profit-driven industry, can we only see competition and not coexistence?
