Aave (AAVE) cryptocurrency has experienced a significant price decline this week, reaching its lowest level since June 28. The token has entered a local bear market, dropping by 23% from its peak of $337 in July.
Despite the price crash, the Aave ecosystem is thriving, with the total value locked in the platform hitting a record high of $35 billion. This marks a substantial increase from the $21 billion in assets at the beginning of the year.
One of the driving forces behind this surge is Ethena (ENA), whose assets have recently soared to nearly $5 billion. Data from Dune Analytics shows a $1 billion increase in assets over the past two days.
This growth has also led to a significant rise in fees for Aave. The platform has collected over $783 million in fees in the last year, with annualized earnings reaching $47 million and revenue exceeding $110 million.
Data from TokenTerminal reveals a 21% increase in net deposits for Aave in July, with active loans rising by 25% to $20.5 billion. Monthly fees and revenue have also seen substantial growth of 49% and 85%, respectively.
The competitive landscape of the DeFi lending space is also heating up, with platforms like Morpho, Compound Finance, and Maple Finance gaining traction.
From a technical analysis perspective, Aave’s price chart shows a steep decline since its peak in July, falling below key moving averages and approaching the $250 support level. The Relative Strength Index indicates oversold conditions, while the token sits on an ascending trendline dating back to April.
If Aave manages to rebound, it could target resistance at the $312 level. However, a break below the trendline would invalidate this bullish scenario.
Overall, while Aave’s price may be struggling in the short term, its ecosystem fundamentals remain strong, pointing towards potential growth and resilience in the long run.