TechFlow news, December 18 — According to The Block, on December 18 the Polygon community rejected a revenue-generating proposal involving $1.3 billion in stablecoin bridged assets. The proposal, put forward by Web3 risk service provider Allez Labs in collaboration with Morpho and Yearn, aimed to generate yield from DAI, USDC, and USDT reserves on the PoS Bridge. Community members expressed concerns over security risks and the lack of user opt-in mechanisms.
The dispute escalated when Marc Zeller, founder of Aave Chan Initiative—a contributor group to the Aave protocol—proposed gradually shutting down Aave's lending protocol on the Polygon PoS chain to mitigate potential security risks. In response, Polygon issued a firm rebuttal, pointing out that Aave Chan had previously proposed, in August, converting bridged funds into Aave’s yield-bearing token stataUSDC, but only shifted to issuing threats after its main competitor, Morpho, gained traction.
Aave founder Stani Kulechov subsequently stepped into the debate, emphasizing that Aave currently accounts for 40% of Polygon’s total value locked and that Aave’s primary governance functions operate on Polygon. He criticized the Polygon team for straying from its mission and wrongly blaming Aave’s leadership for the proposal’s failure. Ultimately, Polygon’s development team confirmed it would not move forward with the proposal, but stated it would continue exploring innovative solutions in the future.
