Aave Dao Greenlights $1 million token buyback every week amid declining market

Defi's biggest protocol, Aave Aneave Distributed Autonomous Organization (DAO), has officially approved the $1 million token repurchase initiative that begins on April 9th.

The proposal received 439,000 votes, well above the required 320,000 quorum, with only 2,020 votes against it.

The move is part of a broader plan to enhance Aave's talknomics and coordinate long-term protocol incentives.

Meanwhile, development coincides with a sharp drop in Aave's market value. According to data from Cryptoslate, tokens have fallen by nearly 21% in the last 24 hours, trading at around $120 as of press time.

With this in mind, Marc Zeller, founder of the Aave Chan Initiative (ACI), said:

“DAO buybacks will own 2.5% of the supply (Aave's token) by the end of the year.”

The first phase starting with a $4 million allocation

The newly passed proposal introduces several important updates to Aave's financial governance. It will establish the Aave Finance Committee (AFC) and oversee financial activities and repurchase execution.

In the early stages, AETHUSDT grants $4 million AFC access and funds an approximately one month Aave token buyback. However, the entire program aims to repurchase Aavely worth up to $1 million over six months.

This step-by-step approach allows the protocol to finalize the deployment of updated Aave Swapper contracts that automate future buybacks. DAO also allows you to monitor and adjust programs based on performance and market conditions.

Protective measures are incorporated into the structure. There will not be direct token transfers from the Ministry of Finance. All expenditures remain within budgets approved through governance. This ensures transparency while enabling timely execution.

Meanwhile, Zeller hinted at the ability to expand its six-month timeline.

He cited past initiatives like Merit. This was originally planned for six months, but I've been running for over a year. He noted that if the buyback proved successful, there are likely similar extensions.

He said:

“Buyback is forever. The rate is what DAO voted at a slow, conservative rate for the next six months. Just like Merritt, we started for six months and now we are celebrating the 16 months of the program.