Decentralized autonomous organizations (DAOs) govern some of the biggest decentralized finance protocols, including Curve Finance and Aave.
Disagreements within a decentralized autonomous organization (DAO) are a sign of a healthy DAO, according to Dr. Michael Egorov, founder of the decentralized finance (DeFi) platform Curve Finance.
DAOs are a decentralized organizational structure that relies on smart contracts to automate functions and member voting to govern onchain protocols.
Egorov said that both a 2024 governance proposal involving the Curve DAO and the recent dispute involving the Aave DAO illustrate the importance of disagreements to the structure’s vitality. He told Cointelegraph:
“If everyone automatically agrees on something, it feels like people just don’t really care. They vote for whatever comes in, or they don’t participate at all. The first sign of that would be governance apathy, like when people are not voting at all.”
That earlier Curve DAO matter concerned a 2024 governance proposal to provide Swiss Stake AG, the main developer behind the Curve Finance protocol, with a grant valued at about $6.3 million at the time, which drew significant pushback from members of the Curve DAO.
Egorov noted that the proposal was revised and resubmitted in December 2025, and the redrafted proposal received over 80% turnout from DAO members.
An analysis last year by blockchain development company LamprosTech found that “Voter turnout in most DAOs rarely passes 15%, concentrating decision-making power in the hands of a small, active group.”
Curve token holders lock up their tokens for a long period, which encourages long-term governance engagement, Egorov said.
Egorov said that DAOs represent a new model for human organization that is distinct from a company or a self-sovereign country, but features elements of a sovereign country, including political parties voicing disagreement about how to govern a protocol.
Related: Core technical contributor to cease involvement with Aave DAO
In December 2025, a governance dispute erupted between Aave Labs, the main development company of Aave products, and the Aave DAO over fees from the integration with DeFi exchange aggregator CoW Swap.
Members of the DAO were critical of the fees from the integration going directly to a wallet controlled by Aave Labs, and the pushback sparked a debate over which entity has rightful control over intellectual property on the DeFi platform.
A proposal was then submitted to the Aave DAO to bring Aave brand assets and intellectual property under the control of the DAO; it ultimately failed to pass.
DAOs cannot interact with the real world without regulated legal structures, like business entities or bank accounts, and DAO control over intellectual property is a common governance issue, Egorov said.
DAOs are a great fit for governing anything onchain, he said, adding that users should also experiment with DAOs for offchain elements as well, though centralized companies might be a better fit to manage offchain structures.
If DAOs could be legally recognized and interact with the traditional financial world, owning business entities and bank accounts, it could mitigate governance disputes, Egorov said, adding that the legal system has yet to catch up to the latest technology.
