The US Securities and Exchange Commission has closed its investigation into the Aave protocol, ending years of regulatory uncertainty.
The move reflects a changing enforcement posture toward decentralized finance. It also reshapes expectations for crypto oversight in the United States.
Stani Kulechov, Aave’s founder and chief executive, disclosed the outcome in a public post on August 12. He said the SEC concluded its probe without recommending enforcement action.
Kulechov described the process as resource-intensive for Aave and DeFi more broadly. He added that the decision opens space for developers to innovate and contribute to the future of finance.
How the SEC probe into Aave unfolded
The SEC began examining Aave in late 2021 or early 2022. At the time, the agency broadened crypto enforcement beyond centralized exchanges.
Its attention shifted to DeFi platforms offering lending, borrowing, and liquidity services without intermediaries. Regulators assessed whether these activities triggered US securities laws.
The SEC never publicly detailed its concerns. The probe focused on the AAVE token and protocol governance.
Key questions involved registration obligations and investor protection standards. Throughout the investigation, Aave cooperated with regulators and maintained ongoing engagement with SEC staff.
In June 2025, Aave representatives met with members of the SEC’s Crypto Task Force.
The discussions addressed regulatory approaches for decentralized protocols.
The SEC has not confirmed whether those talks influenced the closure decision. Still, they reflected sustained dialogue between DeFi developers and regulators.
The investigation ended through a standard SEC notice.
The letter stated that staff did not intend to recommend enforcement action related to the matter, identified internally as “HO-14386.”
The notice included a disclaimer. It said the decision did not amount to exoneration and did not prevent future action if concerns arise.
A broader shift in US crypto enforcement
The Aave outcome aligns with a broader change in US crypto regulation.
Under former SEC chair Gary Gensler, the agency pursued aggressive enforcement.
In 2021, it launched 19 crypto-related actions within nine months. Many cases targeted major industry participants.
Since President Donald Trump returned to the White House, enforcement trends have shifted.
The SEC has eased action in more than 60% of ongoing crypto cases, according to public records.
A New York Times review found the agency dismissed, paused, or reduced penalties in most active cases since January 20, 2021.
During Trump’s first term, the SEC averaged one major crypto case per month, including the action against Ripple Labs.
Today, enforcement pressure appears lower for firms such as Binance, Ripple, and Gemini.
Paul S. Atkins, the current SEC chair, has called the change a “new day” for crypto. The conclusion of the Aave investigation underscores that transition.
Following the announcement, Aave (AAVE) price reached a high of $194 before dipping to a low of $184. The token has since stabilized at $184.90, marking a 1.06% loss over the past 24 hours.