After four years, the U.S. Securities and Exchange Commission has concluded another cryptocurrency investigation.

The U.S. Securities and Exchange Commission has officially announced the dropping of its investigation into the Aave protocol.

"In recent years, DeFi has faced unfair regulatory pressure. We are pleased to be free from this predicament and to enter a new era where developers can truly build the future of finance," Aave founder Stani Kulechov stated in a recent social media post.

Four-Year Investigation

The core of the U.S. Securities and Exchange Commission (SEC)'s cryptocurrency strategy is to classify tokens as securities by proving that tokens rely on the "managerial efforts" of a centralized group.

After four years of investigation, the SEC has apparently failed to find sufficient evidence of clear securities violations and therefore cannot file a lawsuit.

By the end of 2025, the regulatory environment in the United States has significantly softened.

Since Paul Atkins took over as chairman of the SEC at the beginning of 2025, the agency has no longer adopted a "regulation by enforcement" approach. Earlier this year, similar investigations into Uniswap and Ondo Finance were also dropped.

The agency may be deprioritizing cases against "true DeFi" protocols that do not directly hold user funds.

Bad News

The regulatory news is undoubtedly positive, but Aave is currently facing a serious internal crisis, which complicates the situation.

Aave Labs recently integrated "CoW Swap" into the Aave frontend and began diverting trading fees (estimated at about 10 millions USD per year) into its own account, rather than into the DAO treasury.

Token holders are outraged, considering this an "income grab" by the development team circumventing decentralized governance.

If this governance dispute is not resolved, it could lead to a "split."