The AAVE token has experienced a significant 23% decline from its July peak price of $337, entering a bearish phase within its market cycle. This downward movement stands in stark contrast to the protocol achieving new milestones in adoption and usage.
Despite the token price retracement, AAVE’s Total Value Locked (TVL) surged to record levels, reaching $35 billion. This figure marks a substantial increase from the $21 billion TVL recorded at the beginning of the year.
A major driver of this TVL surge was the rapid expansion of Ethena Labs’ operations, which contributed nearly $5 billion in assets deposited into the AAVE ecosystem.
Financially, AAVE demonstrated robust performance indicators. The protocol saw a significant 49% monthly increase in fees, totaling $783 million in July. Correspondingly, its protocol revenue also grew by an impressive 85% during the same month, affirming its strong market position within the competitive DeFi lending sector.
From a technical analysis perspective, the AAVE token has breached below both its 50-day and 100-day Exponential Moving Averages (EMAs), signaling weakening short-term momentum. Market watchers identify the $250 level as a critical technical support zone for the token.