The Aave Treasury Management Vision

Real Time Data MetricsPerformance AnalysisFinancial ReportingCash Flow StatementBalance SheetIncome StatementBudgeting / Forecasting Expenses

We would recommend that illiquid investments be limited to a maximum of 50% of the treasury portfolio at any particular time, which is in line with the mean endowment allocation to illiquid alternatives. In practice, we would expect illiquidity to remain much lower than this maximum.

Aave will continue to build a public Dune Dashboard 25 that tracks protocol revenue and expenses over time. This will provide the community a real-time view into financial performance and treasury spending. The community could also monitor the Aave treasury’s performance via token holdings and the correlations between what the treasury holds and ot... See more

The Aave Protocol (referred to herein as “Aave”) is primarily focused on innovation, growth, and developing relationships within the Ethereum DeFi ecosystem. The treasury can support experiment-driven innovation leading to future Aave growth while investing aToken reserve income to earn additional returns. The treasury can be utilised to increase t... See more

The Aave Treasury ought to be utilised by the community to reflect the values and ambitions of the protocol. The protocol seeks growth and the accumulation of strategic assets, while continuing to be a leading DeFi citizen. Financial capital is to be deployed with holistic oversight, balancing a longer-term vision with consideration towards shorter... See more

After ensuring operational needs are accounted for, illiquidity can be used to capture higher returns. Theoretically, and as part of the analysis when making an investment, illiquid assets (e.g. seed stage investments or strategic cross-DAO partnerships with defined lock-up terms) should capture a return premium relative to liquid assets. This is w... See more

A Treasury Committee is to be created consisting of 5 community-elected individuals from within Aave and Llama. The committee will help shape how the treasury is managed, as well as ensuring there is open and transparent communication and alignment across the broader Aave ecosystem. The standard ARC and AIP process will be followed for all treasury... See more

The vision for the Aave treasury is to encourage innovation, accelerate growth, and prudently manage financial assets, while providing relevant and transparent financial reporting content. As long term believers in Aave, the protocol is to remain overweight $AAVE capturing future growth upside, whilst hedging against the risks of adverse market con... See more

Managing the progression from using AAVE to aTokens for paying expenses shall require budgeting for future costs, forecasting future revenue and considering other potential use cases for aTokens. Ultimately, the vision is to have sufficient aToken inflows to accommodate all use cases.