Aave (AAVE), one of the most prominent decentralized finance (DeFi) protocols, is gaining renewed momentum in the crypto markets, with its token surging above $260. The rally reflects broader recovery trends in the DeFi sector and Aave’s growing dominance within the ecosystem.
Aave Now Commands 20% of Total DeFi TVL
In a post shared on X (formerly Twitter) on May 20, the Aave team announced that it now holds 20% of the total value locked (TVL) across all DeFi platforms a major milestone that underscores its increasing relevance. According to Sealaunch, Aave’s TVL has more than doubled from $56 billion in January to $115 billion as of May 21.
This growth coincides with a broader resurgence in the DeFi market, which has been buoyed by a powerful rally in Ethereum (ETH) up nearly 60% over the past month and renewed investor appetite for decentralized protocols.
AAVE Price Performance: 80% Monthly Gains
The AAVE token has rallied nearly 80% over the last 30 days, now trading at approximately $260, with an 11% increase in the past week alone. Despite some short-term cooling a 25% decline in 24-hour trading volume the overall trend remains bullish. However, the token is still down roughly 60% from its all-time high of $661 set in May 2021.
Major Catalyst: Aave Expands to Non-EVM Chain
One of the key drivers behind Aave’s surge is its historic deployment on the Aptos blockchain on May 19. This marks Aave’s first integration with a non-EVM (Ethereum Virtual Machine) chain, significantly broadening its cross-chain capabilities and enabling the protocol to tap into new user bases and lending markets.
Further plans include the addition of Soneium and Uniswap V4 LP tokens as collateral, expanding the scope and utility of the Aave ecosystem.
Regulatory Tailwinds and Institutional Appeal
Positive sentiment has also been fueled by progress on the GENIUS Act in the U.S. Senate a regulatory initiative seen as favorable to DeFi leaders like Aave. If passed, the legislation could pave the way for greater institutional participation, boosting long-term growth prospects for protocols with strong compliance and transparency standards.
Technical Analysis: Bullish Continuation With Caution
From a technical standpoint, AAVE is showing strong momentum:
- Above major moving averages: The 10-day EMA and SMA are near $237, and the 200-day EMA is around $200, all comfortably below current prices.
- RSI at 74.6: Indicates overbought conditions, suggesting a short-term pullback is possible.
- MACD in ‘Buy’ zone: Reinforces the bullish outlook.
- Upper Bollinger Band at $271: A breakout above this level could open the door to $300, although caution is warranted due to overextension.
As long as AAVE remains above the 20-day simple moving average at $214, the bullish trajectory is expected to hold.
Aave’s Rise Reflects a Maturing DeFi Landscape
Aave’s latest rally is more than just price action it reflects a growing belief in sustainable DeFi infrastructure, cross-chain evolution, and regulatory clarity. As the protocol cements its position as a cornerstone of decentralized finance, its strategic innovations and expanding ecosystem could push AAVE toward even greater heights in 2025.
