[ARFC] AAVE Buybacks program: An update

Author: ACI (Aave Chan Initiative)

Date: 2025-10-22

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Summary

This ARFC proposes to enshrine a long-term AAVE buyback program funded by protocol revenue.

The program will establish a $50M annual budget with flexible execution parameters, enabling strategic capital deployment by the Aave DAO to further accumulate AAVE tokensnd extending the existing buyback program indefinitely.

Motivation

The Aave Protocol has demonstrated strong revenue generation and treasury growth. With the expiry of the existing buyback initiative, and the strong success of the program, we think it is a opportune time to enshrine a buyback program to further ehance Aavenomics.

The systematic buyback program will continue to add:

1. Value Accrual: Create consistent buy pressure for AAVE tokens using protocol revenue.
2. Treasury Optimization: Convert idle assets into productive capital supporting ecosystem growth financed by debt.
3. Market Stability: Provide programmatic demand with adaptive execution based on market conditions.

Specification:

Program Structure

Annual Budget: $50,000,000

Lead: Tokenlogic and Aave Finance Committee (AFC)

Weekly Execution Range: $250,000 - $1,750,000 in AAVE purchases

• The AFC will have discretion to adapt buyback volume within a 75% range, based on the following factors:
  • Market conditions and liquidity
  • Token price volatility
  • Strategic timing considerations
  • Available protocol revenue

Tokenlogic will be leading the program with the support of AFC and ACI.

Leveraging AFC reserves for growth

The AFC will have the mandate to operate AAVE, wBTC, and wETH reserves to support growth initiatives by debt creation. The HF of these positions must always be maintained above 2 as a floor, and higher as the maintenance debt level.

This proposal gives mandate to the AFC to mobilize currently unstaked wETH from the frontier program to finance growth initiative as collateral

This proposal gives mandate to the AFC to mobilize collector held BTC-equivalent reserves to finance growth initially.

The AFC has a mandate to create credit lines using the AAVE codebase exclusively, such as main Aave instances and approved by governance friendly forks, convert to yield-bearing equivalents, and vote delegation with its reserves.

Funding Sources

Protocol revenue allocation ($50M/year)

Useful Links

[ARFC] Aavenomics implementation: Part one

Disclosure

ACI (Aave Chan Initiative) has not received compensation for creating this proposal.

Next Steps

1. Publication of a standard ARFC, collect community & service providers’ feedback before escalating proposal to ARFC snapshot stage.
2. If the ARFC snapshot outcome is YAE, publish an AIP vote for final confirmation and enforcement of the proposal.

Copyright

Copyright and related rights waived via CC0.