Aave (AAVE) token price climbs past $260 as adoption and market performance continue to strengthen

Aave is gaining ground in the decentralized finance space, with its token climbing past $260 as adoption and market performance continue to strengthen.

Aave (AAVE) has now secured 20% of the total value locked across decentralized finance, marking a significant milestone for the lending platform as adoption and market performance continue to propel it forward.

In an X post published on May 20, Aave announced that it now holds 20% of the TVL across DeFi. The sector as a whole has seen a sharp recovery, supported by a strong rally in Ethereum (ETH), which is up nearly 60% over the past month.

Another post from on-chain analytics platform Sealaunch revealed that Aave’s DeFi TVL has doubled from $56 billion to $115 billion between Jan. 24 and May 21.

Aave now holds 20% of all DeFi TVL. pic.twitter.com/I8FQChIlgv

— Aave (@AaveAeleven) May 19, 2024

The token’s price has followed that momentum. AAVE is trading around $259 at press time, marking an 80% gain in the past 30 days and an 11% rise over the past week.

Still, it remains about 60% below its record high of $661 from May 2021. After reaching a low of $143 in March, AAVE has since more than doubled. Although $627 million was traded in the last day, that represents a 25% decrease from the previous day, indicating some cooling following the most recent spike.

Aave’s recent surge is supported by a number of important events. Most notably, Aave integrated with a non-EVM chain for the first time ever when it deployed its V3 protocol on Aptos on Friday. This milestone improves Aave’s cross-chain lending capabilities and widens its network reach.

In addition, discussions are underway to incorporate Soneium and Uniswap V4 LP tokens as collateral to expand the utility of Aave’s DeFi ecosystem. On the regulatory front, the U.S. Senate’s progress on the GENIUS Act is seen as a win for large DeFi companies like Aave, which may increase institutional adoption.

Aave technical analysis

Looking at the technical picture, AAVE is still on a solid upward trajectory. The price is trading well above all of the major moving averages, with the 200-day EMA hovering around $200 and the 10-day EMA and SMA at about $237, indicating widespread bullish momentum.

At 74.6, the relative strength index indicates an overbought situation. Momentum indicators, like the MACD, are still in the “Buy” territory. AAVE is riding the upper band in the Bollinger Bands, which is usually a continuation sign during a strong rally. Recent sessions have seen an increase in volume, which supports the move.

As long as AAVE remains above the 20-day simple moving average at $214, the bullish trend might continue. A break above $271, the upper Bollinger Band, could open the door for further gains toward the $300 mark, even though overbought conditions suggest a short-term pullback is also possible.