What is expected in the development of AAVE?

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What updates are there in the AAVE code base?

Recent updates to Aave’s code focus on expanding across multiple blockchains, building infrastructure suitable for institutions, and improving tools for developers.

1. Aptos Deployment (August 21, 2025) – Aave’s first integration outside Ethereum-compatible blockchains, using the Move programming language and Chainlink oracles.
2. V4 Development (August 2025) – A new modular design called "hub-and-spoke" is undergoing security audits by multiple firms.
3. Horizon RWA Market (August 27, 2025) – A lending platform for institutions to borrow against real-world assets like government bonds.
4. V3.5 Upgrade (August 7, 2025) – Improvements in transaction precision and the ability to batch multiple actions into one transaction.

Deep Dive

1. Aptos Deployment (August 21, 2025)

What happened: Aave launched on Aptos, a blockchain that doesn’t use Ethereum’s technology. The protocol was rewritten in Move, a programming language designed for safety and speed. Supported assets include Aptos’ native token (APT), sUSDe, and stablecoins.

Aptos allows transactions to run in parallel, making them faster. Aave also uses Chainlink Price Feeds to ensure accurate and tamper-proof pricing. Initially, borrowing limits start at $1 million per asset and can increase as demand grows.

Why it matters: This is positive for AAVE because it opens up fast and low-cost borrowing and lending outside of Ethereum’s network. Move’s design reduces risks in smart contracts, and Aptos’ high transaction speed (over 10,000 transactions per second) could attract more users to decentralized finance (DeFi). (Source)

2. V4 Development (August 2025)

What happened: Aave V4 introduces a "hub-and-spoke" system where liquidity is centralized in a main hub for each blockchain, while individual lending markets (spokes) can be customized.

New features include automated risk management that adjusts collateral requirements dynamically and a liquidation system that only sells enough collateral to keep loans safe. The code is currently being formally verified by Certora, a security auditing firm.

Why it matters: This update is cautiously optimistic for AAVE. Although the new design adds complexity, which means audits take longer, it could make cross-chain liquidity easier to manage and reduce transaction fees by 30–50% for common actions. (Source)

3. Horizon RWA Market (August 27, 2025)

What happened: Horizon is a new market where institutions can borrow GHO stablecoins by using tokenized real-world assets (RWAs), such as government bonds, as collateral.

Built on Ethereum, Horizon includes compliance features like Know Your Customer (KYC) and Anti-Money Laundering (AML) checks, plus multisignature controls for added security. Risk is managed by third-party firms Chaos Labs and LlamaRisk, with limits on the types of RWAs accepted.

Why it matters: This is a strong positive for AAVE because real-world assets can diversify the protocol’s revenue (currently about $3.5 million in daily fees) and help stabilize the GHO stablecoin through institutional demand. However, regulatory challenges remain a concern. (Source)

4. V3.5 Upgrade (August 7, 2025)

What happened: This smaller update improved internal accounting to avoid rounding errors and added the ability to batch multiple transactions into one using multicall.

It also removed the borrowing discount for GHO when using stkAAVE and standardized aToken implementations to make it easier for developers to integrate with Aave.

Why it matters: This update is neutral for AAVE overall. While multicall helps reduce transaction costs for complex DeFi strategies, the main benefits are for developers building on Aave’s platform. (Source)

Conclusion

Aave is evolving to support institutional users through Horizon and to enable seamless liquidity across different blockchains with V4 and Aptos. Key things to watch include how much value is locked on Aptos, the results of V4’s security audits, and how much real-world asset collateral flows into Horizon.

How will Aave’s new cross-chain liquidity hubs change the competitive landscape of decentralized lending?

Why did the price of AAVE go up?

Aave (AAVE) increased by 3.7% in the last 24 hours, outperforming the overall crypto market, which rose by 0.9%. This growth is driven by Aave’s strong performance during a recent market stress test, progress in its partnership with Kraken, and key technical support levels holding steady.

1. DeFi Stress Test Success – Aave handled $180 million in liquidations during the October 10 market drop without any downtime.
2. Institutional Growth – Kraken’s Ink Foundation got approval to use Aave V3, opening new revenue opportunities.
3. Technical Stability – Aave’s price stayed above its 200-day moving average ($255), showing buyer confidence.

Detailed Analysis

1. Aave’s Strength During Market Stress (Positive Sign)

Summary:
On October 10, during a sharp market decline, Aave liquidated $180 million in positions—the largest amount it has ever handled in one hour—without any technical issues (The Defiant). This shows Aave’s reliability compared to centralized exchanges like Binance, which experienced problems.

Why it matters:

• Demonstrates Aave’s strong risk management and automated systems, which can attract users after market shocks.
• Highlights the potential for decentralized finance (DeFi) platforms to gain users as centralized exchanges face challenges.

What to watch:
Total Value Locked (TVL) recovery—Aave’s deposits dropped 11% to $20 billion after the crash. A rebound would indicate growing user trust.

2. Progress in Kraken Partnership (Positive Sign)

Summary:
Aave DAO has finalized a deal with Kraken’s Ink Foundation to license Aave V3 technology for a branded lending platform on Kraken’s Layer 2 network (CoinMarketCap). Aave will earn 5% of the borrowing fees generated for the next 12 months.

Why it matters:

• Expands Aave’s reach into institutional markets through Kraken’s large user base.
• Creates a steady income stream linked to borrowing activity on Kraken.

3. Technical Analysis: Support Levels Holding (Mixed Outlook)

Summary:
Aave’s price found support at the 200-day simple moving average (SMA) around $255. The MACD indicator shows bearish momentum slowing down, but the Relative Strength Index (RSI) at 41.4 is neutral, indicating no strong trend direction.

Why it matters:

• Holding above $255 suggests buyers see value at this price.
• However, the neutral RSI means the price could go either way.
• A move above the 30-day SMA ($281.82) would be a positive sign for a trend reversal.

Conclusion

Aave’s recent price increase reflects its operational strength during volatile market conditions and strategic growth through its partnership with Kraken. While technical indicators suggest cautious optimism, the protocol’s future momentum will depend on revenue from new partnerships and recovery in total deposits after the market crash.

Key point to watch: Can AAVE break above $280, a previous support level now acting as resistance, to confirm a bullish trend?

What could affect the price of AAVE?

Aave’s price is currently influenced by a mix of exciting DeFi developments and broader economic factors.

1. V4 Upgrade (Q4 2025) – New features like modular liquidity hubs and cross-chain support could attract more users.
2. Federal Reserve Rate Cuts – Lower interest rates in traditional finance might encourage investors to explore Aave’s lending platform.
3. Large Investor Activity – Significant purchases after recent upgrades suggest confidence in Aave’s safety and future.

In-Depth Look

1. V4 Protocol Upgrade (Positive Outlook)

What’s Happening:
Aave plans to release its V4 upgrade by the end of 2025. This update will create a unified liquidity system that works across different blockchains, introduce smarter risk controls, and offer features designed for bigger investors and institutions, like “Spokes” that allow customized lending markets. The test version is expected soon, with the full launch later next year (Aave Blog).

Why It Matters:
By making it easier to move funds across blockchains and improving how capital is used, Aave could attract more users and increase the total value locked (TVL) in its system. Historically, such upgrades have led to significant price gains for AAVE, sometimes between 50% and 80% within a few months.

2. Changes in Interest Rates (Mixed Effects)

What’s Happening:
In September 2025, the Federal Reserve lowered interest rates to between 4% and 4.25%. This brings traditional finance yields closer to what Aave offers on USDC stablecoin deposits (around 4.8% annual percentage yield). Aave’s founder, Stani Kulechov, pointed out this could create an opportunity for investors to earn more by moving funds into Aave’s platform (Yahoo Finance).

Why It Matters:
Lower traditional interest rates might encourage more people to use DeFi platforms like Aave. However, Aave’s growth depends on maintaining yields that are attractive compared to safer investments like bonds. Additionally, Aave’s GHO stablecoin has seen over $2.5 million minted since its launch, which could increase demand for the platform.

3. Activity of Large Investors (Short-Term Positive)

What’s Happening:
After Aave’s June 2025 Umbrella upgrade—which improved risk management by replacing the Safety Module with a staking-based system—two large investors (whales) bought nearly 30,000 AAVE tokens, worth about $7.5 million. Data shows that 81% of AAVE holders are currently making a profit, which tends to reduce selling pressure (Coinspeaker).

Why It Matters:
Big investors often buy ahead of major upgrades, helping to drive short-term price momentum. However, technical indicators suggest caution, as resistance around $272 could limit gains if the price struggles to break through.

Summary

Aave’s upcoming V4 upgrade and favorable economic conditions set the stage for potential growth. Still, price resistance near $272–$290 and ongoing regulatory uncertainties in DeFi could limit upside. Keep an eye on the V4 testnet progress and how well the GHO stablecoin maintains its value during market swings. Also, watch if Aave’s liquidation engine (which recently earned $1.6 million) continues to demonstrate the platform’s strength.

What are people saying about AAVE?

AAVE’s price charts are showing mixed signals, while its strong position in decentralized finance (DeFi) is encouraging some investors to bet on a rise. Here’s the latest:

1. A rising wedge pattern suggests a possible 15% drop if the price falls below $260
2. Price depends on Ethereum’s movement: could reach $576 if Ethereum rallies, or drop to $250 if it doesn’t
3. Bullish setups point to a target range of $340–$344
4. Price forecasts for 2025 vary widely between $263 and $389

Deep Dive

1. Bearish signals from a rising wedge pattern

@CryptoPulse_CRU notes that AAVE’s price is forming a rising wedge—a pattern that often leads to a price drop. The Relative Strength Index (RSI), a tool that measures momentum, is showing divergence, meaning momentum is weakening even as prices hit new highs. This suggests a potential drop to between $222 and $238.
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What this means: This is a warning sign that AAVE’s price could fall, as rising wedges typically break downward and the momentum is fading.

2. Price movement tied closely to Ethereum

@mkbijaksana explains that if Ethereum (ETH) breaks its all-time high, AAVE could surge to $576. However, if Ethereum fails to rally, AAVE might correct down to $250. Currently, AAVE shows a positive daily trend but remains heavily influenced by Ethereum’s performance.
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What this means: AAVE’s future price depends a lot on Ethereum’s direction. There’s a potential 131% upside if ETH rallies, but also a 16% downside risk from the current $261 price.

3. Bullish breakout potential

@neil_cryptonova points out that AAVE has broken a long-term downtrend. A retest around $310–$350 could set the stage for a strong move up to $600–$680. However, if the price closes below $300 on a daily basis, this bullish outlook would be invalidated.
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What this means: This is a positive sign for AAVE, as breaking resistance levels often attracts buyers, but it’s important the price holds above key support levels.

4. DeFi growth supports higher price targets

Research from Zoomex forecasts AAVE’s price to be between $263 and $389 in 2025. This optimism is based on new integrations like Aptos (adding 12 blockchains), growth of the GHO stablecoin, and AAVE’s 45% share of the DeFi lending market. However, regulatory challenges could limit gains.
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What this means: AAVE’s strong position in DeFi and ongoing upgrades support a bullish outlook, but investors should watch for regulatory risks.

Conclusion

Opinions on AAVE’s price outlook are mixed. Technical analysis shows some bearish patterns but also bullish reversal signs. On the fundamental side, AAVE’s leadership in DeFi is a strong positive, though some remain cautious about partnerships and regulations. Key price levels to watch this week are $260–$270—falling below this could trigger more selling, while staying above $300 would support a continued upward trend. Ethereum’s price action remains a critical factor influencing AAVE’s medium-term direction.

What is the latest news about AAVE?

Aave is standing strong amid market turmoil, showing both technical strength and attracting regulatory attention. Here’s the latest:

1. Handled Record Liquidations (October 10, 2025) – Managed $180 million in liquidations during crypto’s worst crash without any downtime.
2. Praised in DeFi Stress Test (October 13, 2025) – Recognized at DAS London as a leading example of decentralized stability.
3. Binance Compensation Controversy (October 12, 2025) – Binance’s system failures highlighted DeFi’s reliability, boosting Aave’s reputation.

In-Depth Look

1. Handled Record Liquidations (October 10, 2025)

What happened:
On October 10, triggered by tariff threats from former President Trump, the crypto market crashed hard. During this chaos, Aave automatically liquidated $180 million in collateral within just one hour — its biggest automated settlement ever. Unlike centralized exchanges like Binance, which experienced system outages, Aave’s smart contracts worked perfectly, preventing any bad debt.

Why it matters:
This event was a real-world test of Aave’s technology under extreme pressure. It showed that Aave can manage large-scale liquidations smoothly without human intervention, proving its maturity in handling risk. (The Defiant)

2. Praised in DeFi Stress Test (October 13, 2025)

What happened:
At the Decentralized Asset Summit (DAS) in London, industry experts highlighted Aave’s strong performance during the crash as evidence that decentralized finance (DeFi) is ready for big institutional players. Rebecca Rettig, Chief Legal Officer at Jito Labs, said platforms like Aave “performed exactly as designed” during the $19 billion liquidation event.

Why it matters:
This praise boosts confidence in Aave’s governance and technical strength. As regulators pay closer attention to crypto, such real-world proof could help speed up institutional adoption of DeFi platforms. (Blockworks)

3. Binance Compensation Controversy (October 12, 2025)

What happened:
Binance promised $283 million in compensation after system glitches during the crash, while Aave experienced no downtime. This incident highlighted the weaknesses of centralized exchanges compared to the reliability of DeFi’s automated code.

Why it matters:
The contrast reinforces Aave’s appeal as a censorship-resistant alternative. However, DeFi still faces challenges like lower liquidity, which dropped 11% after the crash. (Cryptonews)

Conclusion

Aave came out of October’s market crash stronger, proving its technology can handle extreme stress while centralized competitors struggled. With regulators watching closely, the question now is whether Aave’s upcoming upgrades can further close the gap between decentralized trust and mainstream institutional use.