Aave's governance turmoil coincides with Bitcoin's surge to $88K, raising market eyebrows

Aave's governance turmoil coincides with Bitcoin's surge to $88K, raising market eyebrows

Bitcoin's recovery to $88,600 comes amid $175 million in ETF outflows over five days, while Aave's governance proposal faced a resounding rejection, with 55.29% voting against.

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Bitcoin (BTC) experienced a slight recovery, bouncing back to over $88,600 after hitting a low of $86,561 earlier in the week. This fluctuation occurred amid diminishing liquidity as the year-end holidays approached, with spot Bitcoin exchange-traded funds (ETFs) recording significant outflows.

On Wednesday, these ETFs saw withdrawals amounting to $175 million, marking five consecutive days of net outflows, according to Farside Investors. In a related development, the Aave community faced internal dissent as members opposed a governance proposal aimed at transferring control of the protocol's brand assets to a decentralized autonomous organization (DAO). The proposal was ultimately rejected on Friday, with 55.29% of voters casting “NAY” and only 3.5% supporting the initiative.

This governance vote underscored the challenges within Aave, a leading decentralized finance (DeFi) platform, emphasizing how community engagement and timing influence decision-making in decentralized governance structures.

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