DeFi titans Aave and Maker clash over $2m profit sharing deal

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GM, Tim here.

Here’s what caught my DeFi-eye recently:

• Aave DAO calls out MakerDAO for failing to hold up its end of a $2 million profit sharing deal.
• Avi Eisenberg is fighting for the $14 million he lost on Waves from prison.
• Polkadot defends its $37 million influencer splurge.

A ‘non-approved fork’?

MakerDAO’s lending protocol Spark — a fork of Aave v3 — is breaking an agreement with Aave DAO, delegate Marc Zeller says.

In February 2023, Phoenix Labs, the company behind Spark, proposed sharing of 10% of the protocol’s profits over two years as a thank you for using Aave’s code.

The proposal estimated Spark would pay Aave a total of $2 million.

But Zeller says Spark isn’t living up to its end of the bargain.

“Due to some creative accounting on MakerDAO, the actual revenue share is much closer to 1%,” he said.

Zeller wants a more “synergistic approach” between the two DAOs, urging other Aave DAO members to weigh in on the issue.

The request for comment gives the DAO the option to declare MakerDAO in breach of the agreement and Spark a “non-approved fork of the Aave codebase.”

The complaint comes as competition between the two DeFi titans heats up.

Aave leapfrogged MakerDAO this year to become the third most valuable DeFi project.

Eisenberg vs Waves

Convicted crypto trader Avraham Eisenberg is in jail awaiting sentencing later this month for his $115 million exploit of DeFi protocol Mango Markets.

But court filings show that he’s also spending his time on another case.

He’s attempting to claw back $14 million, which he alleges Waves creator Sasha Ivanov stole from him on the Waves blockchain in 2022.

Before the case can proceed, Eisenberg needs to serve Ivanov directly — something he’s been unable to do so far.

Eisenberg previously accused Ivanov of running a “bait-and-switch scam,” and a “global Ponzi scheme.”

A DL News investigation last year found crypto wallets linked to Ivanov syphoned $530 million out of a lending protocol on Waves.

Ivanov previously said he agrees that investors’ money was drained, but denies he was involved.

He didn’t return a request for comment this time.

Polkadot’s spending spree

Polkadot is under fire after releasing details of its spending in the first half.

The cooperative that governs Polkadot spent $37 million on marketing initiatives that, critics say, have done little to boost its profile.

Such expenditures include $5 million on influencers — also known as key opinion leaders, or KOLs — to promote the blockchain.

It also spent $180,000 to slap its logo on “an entire fleet of Europe-based private jets” for six months.

“All the networks have similar spending,” one of the report’s authors, who goes by the pseudonym Jeeper, told DL News.

“They are happening behind closed doors, and no one can see what they are paying and to whom.”

Polkadot’s spending rose 140% to almost $87 million from about $27 million in the second half of 2023.

Data of the week

RootData ranks crypto projects based on the number of clicks and searches they receive, reflecting their popularity.

This week, Sentient topped the rankings after it raised $85 million co-led by Peter Thiel’s Founders Fund.

Sentient is creating a blockchain protocol where AI developers can market and monetize their models and data.

This week in DeFi governance

VOTE: Lido to appoint legal firm in response to class-action lawsuit

PROPOSAL: Frax could change which token it uses to issue rewards

VOTE: Arbitrum DAO votes on treasury diversification recommendations

Post of the week

The Wau Holland Foundation, a nonprofit that processes donations on behalf of WikiLeaks, has published a preliminary report on how it has spent the 16,593 Ether raised by AssangeDAO in 2022.

What we’re watching

Ethereum Foundation researchers just officially proposed enshrined proposer-builder separation.

If enacted, the separation will make Ethereum more trustless, among other improvements.

Got a tip about DeFi? Reach out at tim@dlnews.com.