Is AAVE’s Capital Surge in DeFi All for Show? Prices Stall Despite Growth

by
  • AAVE, all by its lonesome, holds a cool 5% of the stablecoin supply—outdoing the combined efforts of all CeFi lenders. Take that, centralized finance!
  • For 2.5 years, AAVE has consistently dominated, holding 60% to 80% of the lending sector’s share. Guess someone’s doing it right.

So, DeFi might actually be growing up. It’s shedding its scrappy underdog persona. Who knew?

And it’s all thanks to some good old-fashioned streamlining after the SEC’s DeFi roundtable this year. Naturally, AAVE was one of the lucky ones, basking in the aftermath of all that action.

With this newfound clarity, AAVE saw a growth spurt, surging from a humble 3% of circulating stablecoins in January to an impressive 5% by July 2025, according to analyst Leon Waidmann. Growth like this? Must be someone taking DeFi seriously.

It’s not just the numbers—it’s the signal. AAVE’s rise isn’t just a fluke; it’s a sign that users, both retail and institutional, are starting to park their capital in a whole new way.

Deposits and Borrowing: A Tale of Two Demands

USDC seems to be everyone’s favorite thing to park, with $669 million in deposits on AAVE. WETH comes in second at $180.3 million. But when it comes to borrowing, the game changes.

USDe and USDT dominate borrowing activity, with $604.5 million and $282.7 million in borrowings, respectively. However, the curious case of USDC: people park it in massive quantities but borrow it? Meh. Only $87.4 million borrowed. What gives?

Meanwhile, USDe sees a reverse pattern—high demand for borrowing, but barely any deposits. Interesting, right? Looks like people are lining up for stablecoins like never before.

In terms of revenue, AAVE isn’t slowing down. Since January 2023, its slice of the lending revenue pie has stayed between 60% and 80%. No wonder they’re projecting around $100 million in annual revenue.

Despite its towering capital dominance, AAVE isn’t just sitting pretty. The protocol boasts 1.46k active addresses and 179k holders, according to IntoTheBlock. But don’t get too comfy—other DeFi protocols like DAI and Uniswap are still flexing stronger day-to-day activity.

So, while AAVE’s capital game is strong, the daily hustle still belongs to the others. Maybe AAVE should get out more? 😂

Price Stalls as Liquidity Crunches… Oops

Here’s where the plot thickens: AAVE’s price is stuck. According to Coinalyze’s 2-hour chart, the price bounces between $248 and $284. But every time it tries to rise, it just… doesn’t. Talk about a glass ceiling. 😬

Over the past few days, liquidity in the order books has dried up like a raisin in the sun. The result? AAVE’s price is stuck in a sideways rut. Not exactly the thrilling ride we were hoping for.

Between June 24th and July 1st, liquidations went haywire, with no clear direction. Eventually, the price settled in a narrow range of $260–$270. Not exactly the breakout we were all waiting for.

Unless AAVE breaks above $284 or drops below $260, it’s just going to keep hanging out in the middle, with no momentum to speak of. Kind of like that one friend who never wants to leave the couch. 😆

Read More

2025-07-06 07:18