Aave, together with Kamino and Veda, submits argument to the SEC: DeFi lending and vaults should not be treated as securities.

Aave Labs, Kamino, and Veda submitted a legal framework to the SEC's Crypto Task Force and Division of Corporation Finance on October 26, arguing that decentralized lending protocols and non-custodial vaults do not constitute securities offerings under existing law. The filing contends that lending markets involve no issuer promise, that DAO governance of parameters such as collateral ratios and interest rate models is administrative rather than managerial, and that the Howey test's "common enterprise" prong is not met because suppliers share infrastructure and prices rather than the fortunes of a common venture. It also argues vault depositors retain ownership of their assets and that curators lack custody, so vaults are not investment companies. The three firms are not seeking a safe harbor or exemption, but ask the SEC to confirm current law already covers these designs; the SEC has not yet endorsed the position. The outcome matters for AAVE and other governance tokens and on-chain vault products, which would see securities-registration risk drop sharply if the logic is accepted. The hardest issues remain actively curated vaults and performance-based fees, and next steps include requested meetings with SEC staff and public feedback on the framework.