US EditionAave loses key risk manager Chaos Labs amid contributor exodus and disputes
Chaos Labs said Aave V4 would require at least $8 million a year for risk work, far above the protocol’s $5 million renewal offer.
- On Sunday, risk management firm Chaos Labs terminated its three-year partnership with DeFi lending protocol Aave, walking away from a $5 million renewal proposal. The firm helped Aave grow to more than $26 billion in total value locked.
- CEO Omer Goldberg stated the upcoming Aave V4 upgrade doubles risk management scope, requiring at least $8 million annually. Chaos Labs argued the proposed $5 million budget, roughly 2% of protocol income, falls below the 6% to 10% industry standard.
- Goldberg pointed to a "fundamental misalignment" with Aave's evolving strategy, noting that "money solves many problems, but not all of them." Chaos Labs claimed the engagement no longer reflected their preferred approach to managing risk.
- Aave Labs founder Stani Kulechov stated the protocol will continue without disruption, working with LlamaRisk and internal teams for uninterrupted risk coverage. Kulechov noted Aave declined granting Chaos Labs sole-provider status, prioritizing "resilience" through multiple contributors.
- This departure marks the third high-profile exit from Aave's contributor ranks in recent months, following ACI and BGD Labs. The protocol faces a critical transition in risk oversight as it implements the complex V4 upgrade.
20 Articles
20 Articles
Aave loses key risk manager Chaos Labs amid contributor exodus and disputes
A key sticking point is Aave’s V4 upgrade, which introduces a new architecture and significantly expands the scope of risk management. Chaos argues this shift increases both operational complexity and responsibility, without a matching increase in resources or alignment.
Last major contributor quits Aave as V4 rollout stirs risk and governance clash
After more than 3 years, Chaos Labs is finally leaving Aave due to disagreements over how to handle risk in the new V4 system. According to a post on the Aave governance forum and social channels, Chaos Labs has been running the Aave engagement at a loss, and moving from V3 to V4 will double their workload and significantly increase risk. The firm emphasized that the dispute goes beyond financial terms, pointing instead to a “fundamental misalig…
Why Chaos Labs Just Walked Away From Managing Aave's Risk Operations
Key Highlights After three years of partnership, Chaos Labs has stepped down from its role as Aave’s primary risk manager due to budget constraints and strategic conflicts. According to the firm, overseeing Aave’s upcoming V4 upgrade would double their workload without corresponding resource increases. Despite a proposed $5 million annual budget, Chaos Labs maintains the engagement remained financially unsustainable. Aave’s CEO Stani Kulechov r…
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