AAVE trades above $90 as protocol deposits exceed $350 million and adoption accelerates. However, weakening retail demand and bearish derivatives weigh on price.
Protocol Growth Reaches New Highs
Aave (AAVE) continues to trade above the important $90 threshold, showing resilience despite growing caution across the broader cryptocurrency market. The decentralized lending platform has benefited from rising institutional and on-chain activity, even as retail participation remains muted. While the token has stabilized above its 50-day Exponential Moving Average (EMA) near $90.80, market indicators suggest investors are still waiting for stronger confirmation before committing to a sustained rally.
The protocol itself is expanding at an impressive pace. Aave V4 recently surpassed $350 million in deposits, marking its highest level to date after adding more than $100 million over the last month. At the same time, Aave V3’s integration with the Monad Layer-1 blockchain attracted over $500 million in deposits while supporting more than $215 million in active borrowing.
Part of this expansion has been fueled by an attractive borrowing program that offers eligible users a negative 0.2% USDC borrowing rate when using assets such as cbBTC, WBTC, WETH, and wstETH as collateral. The incentive has strengthened liquidity across the protocol and encouraged larger capital inflows.
Key highlights include:
- Aave V4 deposits climbed above $350 million, a new all-time record.
- Monad-based Aave V3 accumulated over $500 million in deposits.
- Active loans on Monad exceeded $215 million.
- Promotional borrowing incentives continue attracting liquidity providers.
Retail Interest Remains Under Pressure
Despite improving protocol fundamentals, AAVE has yet to generate comparable enthusiasm among retail traders. Activity in the derivatives market paints a more cautious picture, suggesting many investors remain skeptical about the token’s short-term direction.
According to recent market data, futures open interest dropped more than 6% during the previous 24 hours to approximately $302.15 million. Lower open interest typically reflects traders closing positions rather than initiating new ones, indicating declining speculative participation.
Market sentiment has weakened further as the funding rate slipped into negative territory at -0.0046%. Negative funding generally signals stronger demand for short positions than long positions. Supporting this view, the 24-hour long-to-short ratio fell to 0.9372, confirming that bearish traders currently hold the upper hand.
While the protocol continues attracting deposits, this disconnect between network usage and token demand highlights a market that remains cautious despite improving fundamentals.
Can AAVE Avoid a Drop Toward $70?
From a technical standpoint, AAVE is holding a critical support zone near its 50-day EMA at $90.80, preserving a modestly positive short-term structure. However, the token remains well below its 200-day EMA at $112.75, indicating that the broader trend has yet to shift decisively in favor of buyers.
Momentum indicators continue to lean bearish. The Moving Average Convergence Divergence (MACD) remains below its signal line, reflecting persistent downside pressure. Meanwhile, the Relative Strength Index (RSI) sits around 49 and continues trending lower even as prices attempt to stabilize. This divergence suggests buying momentum is fading despite recent gains.
A decisive daily close below $90.80 could expose AAVE to additional selling pressure, with the next major downside target located near the June 18 low of $70.65, representing a decline of roughly 20%.
On the upside, bulls must first reclaim the important $100 psychological barrier, followed by resistance around $103.51. Successfully breaking above this zone would strengthen the recovery outlook and potentially open the path toward the 200-day EMA at $112.75.
For now, AAVE’s expanding ecosystem provides encouraging long-term fundamentals, but weakening retail participation and bearish derivatives positioning continue to limit confidence in a sustained price recovery.