Aave's leading risk management firm Chaos Labs announces exit

CycleProphet · 2026-04-07T00:10:08+00:00

Aave's risk management organization Chaos Labs announced the termination of their partnership, ending three years of service. The reasons include long-term losses, key personnel departures, and disagreements over risk management philosophy. Although Aave Labs proposed funding plans, both parties still have irreconcilable differences regarding budgets and priorities. Aave's CEO stated that V3 is still operating normally, and V4 does not have a mandatory migration schedule.

CycleProphet

2026-04-07 00:10:08

Abstract generation in progress

Deep Tides TechFlow message, April 07, according to The Block, Aave’s leading risk management firm Chaos Labs announced that it has officially ended its collaboration with Aave, closing out risk management services that lasted for nearly three years. Chaos Labs founder Omer Goldberg said the main reasons for the exit are threefold: it has been operating at a loss for the long term, key contributors BGD Labs and ACI have left one after another, and there are fundamental differences in risk management philosophies with Aave Labs in the context of the launch of Aave V4.

It is reported that Aave Labs previously proposed a $5 million budget carryover arrangement, but the minimum budget required for Chaos Labs to actually operate V3 and V4 is $8 million. Even if the budget issue can be resolved, the disagreement between the two parties on risk management priorities is still difficult to bridge. Goldberg noted that after V4 goes live, the workload for the transition period will double rather than be cut in half, and the existing infrastructure has not yet been validated in real-world scenarios, so the risks cannot be underestimated.

In response, Aave Labs CEO Stani Kulechov said that the V4 migration does not have a mandatory timeline, and that V3 is still running normally.

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