AAVE Recovers From Recent 15% Slump as DeFi Yield Markets Flourish
AAVE has bounced back impressively after a sharp 15% decline over four days, demonstrating resilience amid global economic uncertainties and renewed trade tensions.
The protocol’s price rebounded from around $240 to surpass $250, driven by growing interest in tokenized yield markets which are attracting both retail and institutional investors.
This resurgence occurs against the backdrop of heightened volatility due to fresh U.S.-China tariff disputes and concerns over trade deal violations, which have roiled broader markets.
DeFi continues to gain momentum with total value locked (TVL) rising to $178.52 billion. AAVE remains a frontrunner, controlling $25.41 billion of this TVL and reaffirming its role as a key decentralized lending platform.
Driving Factors
AAVE’s strength is linked to its integration with Pendle’s tokenized yield products, which saw rapid adoption as new supply caps were hit shortly after launch, highlighting demand for innovative DeFi yield solutions.
The Ethereum Foundation’s $2 million loan in Aave’s decentralized stablecoin GHO, backed by ETH collateral, illustrates strategic borrowing to leverage crypto assets while supporting Aave’s ecosystem.
GHO’s overcollateralization and interest payments bolster Aave’s DAO treasury, emphasizing a community-centric financial structure.
Data from IntoTheBlock shows Aave capturing a commanding 45% market share in decentralized lending from 2023 to 2025, highlighting its steady recovery from the DeFi downturn of 2023.
Technical Snapshot
Strong support formed near $242.70 during key trading periods, with heavy volumes exceeding 90,000 units signaling robust buyer interest.
An ascending triangle pattern has developed, characterized by higher lows and suggesting accumulation despite encountering resistance at around $253.75.
After peaking near $256, AAVE consolidated within the $248-$250 range.
Notable volume surges accompanied price jumps, forming a cup-and-handle pattern indicative of bullish continuation.
Consolidation near $249 alongside increasing buying volume points to a potential breakout above the $250 resistance level.
With DeFi yield markets expanding rapidly, AAVE’s ability to adopt new products and sustain strong support levels makes it well-positioned for growth despite ongoing macroeconomic challenges.
