Aave Advances Automated AAVE Buyback Overhaul With Aavenomics 3.0

Aave founder Stani Kulechov previewed Aavenomics 3.0 on X Thursday, a tokenomics overhaul that would replace the protocol’s existing discretionary buyback program with an automated, non-discretionary on-chain mechanism funded by all protocol and $GHO revenue.

The announcement came as Kulechov responded to a CoinDesk report that Kraken parent Payward was in talks to acquire a 15% equity stake in Aave Group at a $385 million valuation. Kulechov disputed the “70% discount” framing in the report while using the moment to lay out Aave’s existing and planned revenue structure for token holders. Aavenomics 3.0 is the consequential part: an automated buyback system that executes at the protocol level, running continuously unless governance votes to halt it.

Current Buyback Program

Aave’s governance approved the Aavenomics Part One ARFC in early 2025, which gave the Aave Finance Committee a mandate to execute $AAVE buybacks from secondary markets at $1 million per week during the initial six-month period. That works out to roughly $50 million annually in discretionary repurchases, coordinated through the Aave Finance Committee and funded from protocol excess revenue.

The mechanism is committee-directed: governance can redirect, pause, or resize the program without a protocol-level change. Aavenomics 3.0, as described by Kulechov, would harden the buyback into the protocol’s economic architecture. Details on the implementation mechanics and governance timeline are expected at Aave’s next quarterly call, per Kulechov’s post.

Revenue Flowing to the Token

The broader context for the buyback upgrade is the Aave Will Win (AWW) framework, which passed governance in April 2026. Under AWW, 100% of revenue from Aave Protocol, from $GHO, and from Aave-branded products including Aave App, Aave Pro, and Swaps flows entirely to the Aave DAO treasury. Aave Labs operates solely as a DAO service provider and retains no product revenue.

$GHO, Aave’s native stablecoin, has grown to approximately $599 million in circulating supply, per DefiLlama, generating incremental protocol fee income alongside lending revenues. Aave’s all-time protocol fees exceed $2.2 billion, with annualized fees running at roughly $400 million based on the trailing seven-day window.

Aavenomics 3.0 would route that revenue stream through an automated mechanism. Under the design Kulechov described, buybacks would execute without requiring committee approval on each cycle, making repurchases a standing feature of how the protocol distributes economic output to token holders.

The Kraken Equity Context

The CoinDesk report described a deal in which Payward would receive 250,000 $AAVE tokens and a 15% common equity stake in Aave Group, with Payward also seeking to syndicate the deal. The $385 million valuation sits below $AAVE’s fully diluted token valuation of roughly $1.52 billion at current prices.

Kulechov’s pushback, reported by Unchained, drew a structural distinction between Aave Group as a corporate entity and the $AAVE token as the economic vehicle. The equity in Aave Group represents a claim on the corporate service provider, which under AWW receives DAO-funded development budget but retains no protocol or product revenue. The $AAVE token captures all of that economic output. Aave Labs holds its own $AAVE token allocation, and Kulechov said multiple market participants have discussed purchasing it through long-term partnerships.

Payward’s interest follows its integration of Aave technology through Kraken’s Layer 2 network Tydro. The Defiant reported Thursday on Kulechov’s initial dispute of the deal framing. Kraken has made no public statement on the status of the talks.

$AAVE Price

$AAVE was trading around $95 Friday morning, up roughly 13.5% over the prior 24 hours and up about 27% on the week, per CoinGecko. The token’s market cap stood at approximately $1.44 billion, against total value locked on Aave of $12.46 billion, per DefiLlama.

Aavenomics 3.0 governance details have not yet been published on the forum; the quarterly call is where Kulechov indicated the full specification would be released.