AAVE Token Slides 23% as Ecosystem Assets and Fees Hit Records

Key Insights

AAVE token has entered a local bear market after dropping 23% from its July peak of $337, reaching its lowest since June 28.

Total value locked in the Aave ecosystem surged to $35 billion this week, rising sharply from $21 billion at the start of the year.

Fees collected in the Aave network exceeded $783 million over 12 months, with annualized revenue reaching $110 million amid higher loan activity.

AAVE price has fallen sharply this week, extending a month-long decline that has erased significant gains from July. The token is now down 23% from its peak of $337.25 reached earlier in the month, entering a local bear market phase. It is currently trading near its lowest level since June 28.

The price drop comes even as Aave reports strong on-chain performance. Data from DeFi Llama shows that the platform’s total value locked has surged to $35 billion, up from $21 billion at the beginning of 2024. This marks the highest level ever recorded for the lending protocol.

Ethena’s Impact on Growth

A key factor behind the increase is the rapid expansion of Ethena, a protocol whose assets have climbed to nearly $5 billion. Dune Analytics data indicates that Ethena’s holdings grew by more than $1 billion in just two days this week, contributing significantly to Aave’s overall asset growth.

The network’s earnings have also accelerated. Over the past 12 months, Aave collected over $783 million in fees. Annualized revenue has reached more than $110 million, while earnings stand at $47 million. July data from TokenTerminal shows net deposits rose 21%, with active loans climbing 25% to $20.5 billion.

Competitive Landscape in DeFi Lending

The lending market remains competitive, with Morpho, Compound Finance, and Maple Finance also expanding. Despite this, Aave’s growth in assets and fees highlights its strong position in the sector. Monthly fees grew by 49% in July, while revenue increased by 85%.

Source: TradingView

From a technical perspective, AAVE has broken below both the 50-day and 100-day exponential moving averages. The price is approaching the $250 support level, a key psychological mark. The Relative Strength Index is nearing oversold territory, and the token is resting on an ascending trendline that has been in place since early April. A rebound from this area could push the price toward $312, but a break below would signal further downside risk.

The post AAVE Token Slides 23% as Ecosystem Assets and Fees Hit Records appears on Crypto Front News. Visit our website to read more interesting articles about cryptocurrency, blockchain technology, and digital assets.