Holders of decentralized finance (DeFi) token Aave are taking part in a governance vote on whether 1,600 ether (ETH) valued about $3 million in the protocol's treasury will be converted to wrapped staked ether (wstETH) and rocket pool ether (rETH).

Wrapped staked ether and rocket pool ether are liquid staking derivatives that enable investors to stake tokens for a yield whilst retaining liquidity.

Aave, which is the third-largest DeFi protocol and has total value locked of $6 billion, currently earns a yield of 1.69% from the 1,600 ether by staking it directly on the Aave v2 platform.

One holder notes in the proposal that the protocol would earn 3.8% by staking wstETH and 3.13% by staking rETH.

The price of the Aave token has increased by 7.24% in the past 24 hours for a 29% rise over the past week, according to CoinMarketCap.

There are currently 252,000 votes cast out of the 320,000 required for the proposal to be actioned. The vote will close on Friday.

The majority of votes, all of which are in favor of the proposal at press time, have been submitted by a wallet named "aavechan.eth" which holds $397,000 worth of staked aave (stAave) tokens, according to etherscan.