Major Aavenomics Update: Will Buyback Proposal Pump AAVE Price?

Core Insights - Aave DAO is considering a significant update to its token policy, proposing a permanent annual buyback of $50 million for AAVE tokens using protocol revenue [1][2] - The buyback program aims to provide price support for AAVE tokens and is expected to be managed by TokenLogic and the Aave Finance Committee [2][3] - Early community feedback has been largely positive, with Aave founder Stani Kulechov supporting the buyback target increase [4] Proposal Details - The proposed buyback would involve purchasing between $250,000 and $1.75 million weekly, with flexibility based on market conditions and liquidity [1][2] - The program is designed to establish a long-term repurchase strategy funded by the protocol's revenue, which is currently around $169 million annually [2][3] - A Snapshot poll and subsequent on-chain vote will be conducted to implement the policy if the poll is successful [3] Financial Viability - DeFiLlama data indicates that Aave has generated approximately $13.9 million in the past 30 days, supporting the feasibility of a $50 million buyback while covering operational expenses [3] - The upcoming Aave v4 rollout in late 2025 is expected to introduce a new framework for liquidity pooling and risk management, potentially impacting revenue and buyback sustainability [5] Market Reaction - As of the latest update, AAVE was trading around $218, reflecting a 5% decrease for the day, with mixed market reactions to the governance update [4] - Analysts are observing AAVE's price chart, which indicates pressure and challenges in maintaining key support levels [7]