Chaos Labs has stepped down as a primary risk service provider for Aave after three years, citing disagreements over risk management strategy and operational expectations. Founder Omer Goldberg said the decision “was not made in haste” and followed extended discussions with DAO contributors. He noted that Aave Labs supported raising Chaos Labs’ compensation to $5 million to retain its services.
Goldberg warned that the planned migration to Aave V4 would significantly increase operational demands. He explained that until V4 fully absorbs V3 liquidity and markets, both systems must run simultaneously, doubling workloads rather than reducing them. He also stressed the absence of a clear regulatory framework defining responsibility if a protocol failure occurs, stating that risk managers face uncertainty if systems break.
Aave Rejects Sole Risk Control and Oracle Changes
Chief executive Stani Kulechov said Chaos Labs proposed becoming the sole risk provider, which would have forced the removal of LlamaRisk and replacement of price feeds from Chainlink. Aave declined the proposal to preserve its two-layer risk model.
Risk concerns intensified after a user reportedly lost $50 million on March 12. Aave later introduced the “Aave Shield” feature, while confirming operations remain stable and collaboration with LlamaRisk will continue.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.
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