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Why did the price of AAVE go up?

Aave (AAVE) increased by 9.16% in the last 24 hours, outperforming the overall crypto market, which rose by 3.76%. This growth is driven by a combination of widespread buyback activity in decentralized finance (DeFi), a technical rebound after being oversold, and renewed investor confidence in Aave’s risk management.

  1. DeFi Buyback Trend – Aave’s $50 million yearly buyback program fits into a broader move across the DeFi sector to reduce token supply.
  2. Technical Recovery – Aave’s price moved above a key resistance level at $220.67.
  3. Improved Market Sentiment – Comments from Aave’s founder helped reassure investors following a large $42 billion outflow from DeFi.

Detailed Analysis

1. DeFi Buyback Momentum (Positive for Aave)

Summary: Aave has joined other DeFi projects like EtherFi, Maple Finance, and zkSync in launching token buyback programs. Aave’s plan involves spending $50 million annually to repurchase and burn AAVE tokens.

Why this matters:

What to watch: Weekly buyback amounts (targeting between $250,000 and $1.75 million) and the number of tokens burned on the blockchain.

2. Technical Rebound from Key Price Levels (Mixed Signals)

Summary: AAVE’s price has moved back above an important technical level known as the 50% Fibonacci retracement at $220.67 and broke out of a downward price channel that started in August.

Why this matters:

3. Renewed Confidence After DeFi Market Shakeup (Positive for Aave)

Summary: Aave’s founder, Stani Kulechov, described the recent $42 billion outflow from DeFi as a “hard but needed reset” following issues like stablecoin depegs and security breaches (source).

Why this matters:

Conclusion

Aave’s recent price increase is supported by a combination of sector-wide buyback programs, positive technical signals, and its reputation as a reliable platform during a turbulent period for DeFi. The key question now is whether AAVE can maintain its price above $220.67 with strong trading volume. If it fails, some profit-taking could push the price down toward $196. However, ongoing buybacks and improvements in Ethereum’s staking system (with 2.45 million ETH waiting to be withdrawn) could help Aave continue its upward momentum.


What could affect the price of AAVE?

Aave’s price is currently caught between exciting new developments in decentralized finance (DeFi) and ongoing market challenges.

  1. V4 Protocol Upgrade (Positive) – A new modular design could change how DeFi liquidity works.
  2. Buyback Program (Mixed) – $50 million in annual token repurchases versus overall instability in DeFi.
  3. Regulatory Environment (Neutral) – The SEC’s proposed "Innovation Exemption" is still uncertain.

In-Depth Look

1. V4 Protocol Upgrade (Positive Impact)

What’s happening:
Aave plans to launch its V4 upgrade in the fourth quarter of 2025. This upgrade introduces a “hub-and-spoke” liquidity model, which connects different lending pools instead of keeping them separate. This change aims to make it easier to lend and borrow across different blockchains and attract larger, institutional users (Aave Blog).

Why it matters:
Past upgrades, like the V3 update in 2023, led to big increases in total value locked (TVL)—the amount of money users have deposited—by 40–60%. If V4 makes it easier to create specialized lending markets, such as those focused on real-world assets (RWA), AAVE’s price could climb back to its 2025 peak near $265.

2. Buyback Program vs. DeFi Market Challenges (Mixed Impact)

What’s happening:
Aave has a $50 million annual buyback program designed to reduce selling pressure on its token. However, the broader DeFi market has faced setbacks, including a 13% drop in TVL in November due to hacks like the $93 million Stream Finance breach and issues with stablecoins losing their peg (Yahoo Finance).

Why it matters:
In October, buybacks accounted for about 22% of AAVE’s trading volume, helping support the token. But with $42 billion leaving DeFi since early November, these efforts might not be enough. A key metric to watch is the Market Cap to TVL ratio, currently at 0.09; if it falls below 0.07, it could indicate AAVE is undervalued.

3. Regulatory Developments & Stablecoin Competition (Neutral Impact)

What’s happening:
The SEC is considering an “Innovation Exemption” that could make it easier for DeFi projects to comply with regulations. Meanwhile, Aave’s GHO stablecoin is competing with MakerDAO’s DAI, but GHO’s adoption is still much smaller—$312 million compared to DAI’s $5.7 billion (CoinDesk).

Why it matters:
Clearer regulations could help Aave expand its real-world asset lending, like Aave Horizon’s $450 million in deposits. However, GHO needs more liquidity to seriously challenge DAI. If successful, this could increase demand for AAVE tokens by 20–30%.

Conclusion

Aave’s success in 2025 depends on how well it rolls out the V4 upgrade while managing risks in the DeFi market. In the short term, the $170 to $141 price range is a key support zone. Looking ahead, regulatory clarity and wider GHO adoption could spark a new bull run like in 2024. The big question remains: Will Aave’s total value locked surpass $40 billion before the first quarter of 2026?


What are people saying about AAVE?

The Aave community is seeing a mix of positive developments and cautionary signals. Here’s what’s making headlines:

  1. A proposal to buy back $50 million worth of AAVE tokens to reduce supply and strengthen governance.
  2. Technical analysis warns of a possible 31% price drop.
  3. Integration with CoWSwap is boosting optimism about decentralized finance (DeFi) liquidity.
  4. The founder faces criticism over demands related to WLFI token allocations.
  5. Aave is close to reaching $1 trillion in total loans, highlighting its leadership in the DeFi space.

Deep Dive

1. Buyback Proposal to Strengthen AAVE (Positive)

Stani Kulechov, Aave’s founder, proposed a permanent $50 million annual buyback program funded by the protocol’s revenue. This means the protocol would use some of its earnings to buy back AAVE tokens from the market, reducing the total supply. This can help support the token’s price and give holders more influence in governance decisions.
See original post

Why it matters: Buybacks can help stabilize the token’s value by lowering supply and showing confidence in the protocol’s ongoing revenue.

2. Warning of a Possible 31% Price Drop (Negative)

Crypto analyst @CryptoPulse_CRU points out a “rising wedge” pattern in AAVE’s price chart, which often signals a potential drop. If the price falls below the $222–238 support range, it could lead to a decline down to $170–180. The Relative Strength Index (RSI), a tool that measures momentum, also shows signs of weakening.
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Why it matters: This suggests traders who bought at higher prices might sell quickly if support breaks, causing increased price volatility and a significant correction.

3. CoWSwap Integration Enhances User Experience (Positive)

Aave has integrated CoWSwap, a platform that offers MEV-protected swaps. MEV (Miner Extractable Value) protection helps users avoid extra costs caused by front-running and other blockchain transaction issues. This integration works across six different blockchains, offering better pricing and less slippage (price changes during trades).
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Why it matters: Improved trading experience can attract more users and liquidity, which is good for Aave’s growth and borrowing activity.

4. Founder Faces Criticism Over WLFI Token Allocation (Negative)

Some community members, like @yuyue_chris, criticize the founder for requesting 7% of WLFI tokens for Aave, despite Aave not contributing directly to WLFI. This has been seen as a greedy move by some, causing backlash.
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Why it matters: Such disputes can hurt community trust and make future collaborations more difficult.

5. Approaching $1 Trillion in Loans (Positive)

Aave is nearing a major milestone of $1 trillion in total loans issued through its platform. This shows its strong position in the DeFi lending market and suggests growing fee revenue potential.
See original post

Why it matters: Reaching this scale confirms Aave’s dominance and could lead to more growth and stability for the protocol.

Conclusion

The outlook for AAVE is mixed. On one hand, strong fundamentals like the buyback plan and growing loan volume point to long-term strength. On the other hand, technical signals and governance controversies raise caution. Key price support between $222 and $238 will be critical to watch — holding this range could spark renewed momentum, while falling below it might confirm a bearish trend. Overall, Aave continues to be an important indicator of how mature and resilient DeFi has become.

{{technical_analysis_coin_candle_chart}}


What is the latest news about AAVE?

Aave is navigating a challenging market by implementing buybacks and upgrading its platform as confidence in decentralized finance (DeFi) wavers. Here are the key updates:

  1. Technical Breakdown (November 10, 2025) – AAVE’s price is testing support at $200, with potential drops to $170 and $141 if it can’t hold key levels.
  2. DeFi Buyback Surge (November 9, 2025) – Aave launches a $50 million yearly buyback program to reduce token supply, joining other protocols doing the same.
  3. V4 Upgrade Roadmap (September 25, 2025) – A new modular design and improved risk management features are planned for release in the fourth quarter.

Deep Dive

1. Technical Breakdown (November 10, 2025)

Overview: AAVE’s price recently dropped to $200, breaking below its usual trading range from May to November ($221–$336). Technical signals like the "death cross" (when the short-term moving average crosses below the long-term one) and more selling activity suggest bearish momentum. If buyers don’t push the price back above $210–$225, analysts expect a further decline to between $170 and $141.

What this means: This price drop reflects broader weakness in the DeFi market but might attract buyers looking for bargains if the token becomes oversold. Watching on-chain data like support levels and the ratio of long to short positions (currently 0.918) can help gauge market sentiment. (AMBCrypto)

2. DeFi Buyback Surge (November 9, 2025)

Overview: Aave has approved a $50 million annual buyback program, using fees collected by the protocol to buy and burn AAVE tokens, effectively reducing the total supply. This move follows similar efforts by other DeFi projects like EtherFi, Venus, and zkSync, which together have committed over $200 million to buybacks.

What this means: Buybacks can help balance selling pressure caused by users unlocking staked tokens or moving funds out of DeFi. The success of this strategy depends on Aave’s ability to generate steady revenue—its fees reached $124 million in the third quarter of 2025, indicating it can support the program. (NullTX)

3. V4 Upgrade Roadmap (September 25, 2025)

Overview: The upcoming V4 upgrade, planned for Q4, will introduce a modular "hub and spoke" design. This means lending markets ("spokes") will draw liquidity from central hubs, improving flexibility. New features include a liquidation engine designed to prevent cascading margin calls and a Position Manager to automate portfolio adjustments.

What this means: These changes aim to attract institutional investors by allowing customized risk and reward setups. The upgrade’s success depends on smooth cross-chain liquidity sharing and integrating the GHO stablecoin. (Cointelegraph)

Conclusion

Aave faces short-term price challenges due to a $20 billion drop in total value locked (TVL) across DeFi in one week. However, its strategic buybacks and major platform upgrades could help stabilize and grow the protocol. The V4 upgrade, with its modular design and automated risk controls, might be key to reigniting positive momentum and expanding Aave’s appeal to institutional users.

{{technical_analysis_coin_candle_chart}}


What is expected in the development of AAVE?

Aave is working on expanding its decentralized finance (DeFi) platform with key updates:

  1. Aave V4 Launch (Q4 2025) – Introducing a new modular design, shared liquidity hubs, and smarter risk controls.
  2. Public Testnet & Audits (Q4 2025) – Community testing and thorough security reviews.
  3. GHO Multichain Expansion (Ongoing) – Rolling out its stablecoin GHO across multiple blockchains using Chainlink’s CCIP Bridge.

Deep Dive

1. Aave V4 Launch (Q4 2025)

Overview:
Aave V4 will bring a new "hub-and-spoke" system (Aave Governance) that replaces separate liquidity pools with centralized hubs for each blockchain network, like Ethereum and Arbitrum. The “spokes” are customizable lending and borrowing modules that let developers create specialized markets—such as using liquidity provider tokens as collateral—while sharing liquidity across the platform. Key features include:

What this means:
This upgrade should make AAVE more efficient and open up new use cases, including integration with real-world assets for institutions. However, there’s a chance of delays if audits take longer or if moving from V3 to V4 runs into issues.

2. Public Testnet & Audits (Q4 2025)

Overview:
Before the full launch, Aave V4’s code will be tested publicly after extensive security audits (October 2025 Update). Trusted security firms like OpenZeppelin and CertiK are conducting multiple layers of audits, and formal verification methods are being used to mathematically prove the code’s correctness. Aave Labs has already run 934 unit and fuzz tests, covering 100% of the code.

What this means:
This phase is mostly positive—successful testing can build trust in the upgrade. But if audits take longer than expected, the mainnet launch could be delayed. Community feedback during biweekly Office Hours will be important to watch.

3. GHO Multichain Expansion (Ongoing)

Overview:
Aave’s stablecoin, GHO, is expanding beyond Ethereum to blockchains like Aptos, Base, and Avalanche using Chainlink’s CCIP Bridge (Binance News). This expansion aims to increase liquidity and use across different blockchain ecosystems.

What this means:
If GHO gains adoption, it’s a positive for AAVE since fees from GHO help fund AAVE token buybacks. However, risks include potential stablecoin price instability or increased regulatory scrutiny.

Conclusion

Aave’s roadmap focuses on making the platform more scalable (with V4), secure (through audits), and widely accessible (via GHO’s multichain rollout). The success of these efforts depends on a smooth transition from V3 to V4 and how well GHO competes with other stablecoins like DAI. Looking ahead to 2026, Aave’s growing presence across multiple blockchains could significantly influence the future of DeFi competition.


What updates are there in the AAVE code base?

Aave is making big strides toward launching V4, featuring a modular design and stronger security measures.

  1. V4 Security & Public Testnet (October 2025) – Multiple security audits, formal code checks, and testnet preparations are underway.
  2. Horizon RWA Integration (August 2025) – Launch of the first real-world asset market, allowing tokenized assets like treasury bonds.
  3. Aptos Non-EVM Expansion (May 2025) – Aave was rewritten in the Move programming language to run on the Aptos blockchain, a fast Layer 1 platform.

Deep Dive

1. V4 Security & Public Testnet (October 2025)

Overview: Aave V4 is going through thorough security testing before its public testnet release. The development team has created 934 unit and fuzzing tests to cover every part of the code, plus symbolic testing to catch tricky bugs. Four security firms are auditing the code, including formal verification of key parts like the Hub module. Since October, biweekly Office Hours have been held to explain V4’s new features such as credit lines, adjustable risk settings, and treasury management.

What this means: This is a positive sign for AAVE holders and developers. Strong security reduces the chance of hacks, and clear communication builds trust. The upcoming testnet could speed up new projects building on Aave.
(Source)

2. Horizon RWA Instance (August 2025)

Overview: Aave introduced Horizon, its first market for real-world assets (RWAs) like tokenized treasury bonds. This market includes compliance tools such as Know Your Customer (KYC) and Anti-Money Laundering (AML) checks, plus a multisignature system for institutional partners. After testing demand, the asset limits were increased to $1 million per pool.

What this means: This development is cautiously optimistic for AAVE. Real-world assets can bring new revenue streams but require careful risk control. Success depends on how well institutions adopt the platform and how regulations evolve.
(Source)

3. Aptos Non-EVM Expansion (May 2025)

Overview: Aave V3 was redeployed on the Aptos blockchain using the Move programming language, marking its first move outside Ethereum-compatible (EVM) chains. The update includes Chainlink oracles for reliable data and a $500,000 bug bounty to encourage security testing. Supported assets include APT, USDC, and GHO, with supply limits that adjust dynamically.

What this means: This is a positive step for AAVE, as Aptos offers a fast and efficient environment that could attract new users and liquidity. However, how well Aave works across different blockchains still needs to be proven.
(Source)

Conclusion

Aave’s ongoing updates focus on making the platform more modular (V4), bringing in institutional-grade assets (Horizon), and expanding to new blockchains (Aptos). Security remains a top priority, positioning AAVE well for the next phase of decentralized finance (DeFi) growth. The big question is how quickly developers will adopt V4’s new “hub-and-spoke” model once it launches.