Aave, the open-source decentralized finance [DeFi] protocol has witnessed a massive rise over the last few weeks. In terms of the total value locked [TVL in USD] surged by nearly 24% over the past day alone pushing the figures to a new all-time high of $4.96 billion.
The above chart by DeFi Pulse evidenced that money has been flowing through the second-largest DeFi protocol. The latest stats have positioned it as the best performing protocol of recent time.
AAVE’s Soars To New ATH
Interestingly, the protocol only had a few million dollars worth of crypto in it this time last year; since then it has risen to become the second-largest DeFi project on Ethereum. Its native token, Aave also followed the bullish trend, logging historic high prices and recorded a surge of more than 93% over the past week.
In fact, the DeFi token has risen by over 41% in 24-hour alone which drove its price to $436.01, at the time of writing.
Aave has been on an absolute tear even as the rest of the DeFi tokens cooled down. What has helped the token sustain the latest rally?
Aave’s 24-hour trading volume scored a record $1.86 billion according to CoinMarketCap which is partially driven by investors acquiring more tokens for staking. Hence, the rising volume, as well as the growing demand for flash loans among the market participants are the main forces behind the price action.
In addition, the renewed uptrend in the cryptocurrency space has further bolstered the already building momentum.
According to the crypto-analytic platform, Santiment, Aave whales were also fueling the recent rally. Its tweet read,
“Aave whales, which we deem addresses holding 1,000 tokens or more (~$397k+ USD), have ballooned from 266 to 327 addresses this past month, fueling this rally.”
In general, the DeFi tokens have garnered widespread adoption in the latest bull run. So much so that Mike Novogratz, the CEO and founder of crypto-focused merchant bank Galaxy Digital, said that while Bitcoin is probably a” safer option on a risk-adjusted basis”, another class of digital assets such as Aave, Chainlink, Compound, YFI, and Uniswap has the potential to take over in the coming years.