Massive AAVE Whale Buying Leads to 45% Outperformance over Broader Crypto Market

As a researcher with over a decade of experience in the cryptocurrency market, I must admit that I’ve never seen such a surge in AAVE as we are witnessing now. The recent buying spree from the whales and the strong rally in AAVE price has caught my attention like never before.


As an analyst, I’ve noticed a surge in activity from AAVE whales, which has fueled a robust rally in the price of AAVE, resulting in a staggering 45% increase over the past month. Currently, AAVE is trading at $134.24, with a market capitalization exceeding $2 billion.

Based on figures from LookonChain, it’s been found that a large investor (referred to as a “whale”) made a massive purchase of 4,000 $stETH, which equates to approximately $10.4 million. This investment was used to buy around 77,270 $AAVE tokens priced at $135 per token in just one day. This action suggests that the whale’s interest in these assets remains high, even with a robust upward trend observed over the past month.

Crazy buying of $AAVE!
This whale spent 4,000 $stETH($10.4M) to buy 77,270 $AAVE at $135 in just 1 day!
Address:0xa923b13270f8622b5d5960634200dc4302b7611e
— Lookonchain (@lookonchain) August 22, 2024

Over the past month, AAVE has surpassed every cryptocurrency among the top 100 by market capitalization, including heavyweights such as Bitcoin and Ether. The enthusiasm from investors for AAVE is so pronounced that even Helium’s HNT, which recorded a 26% increase last month, still trails significantly behind.

In July last month, Marc Zeller, founder of the Aave-Chan Initiative, suggested a shift in fees on the platform, where a portion of its net excess revenue would be allocated to significant ecosystem contributors and tokens from the secondary market would be repurchased. This proposal served as the primary driver for the surge in AAVE‘s price. Speaking with CoinDesk, Joshua de Vos, research lead at CCData – a London-based provider of digital assets data and indices – stated:

There’s been talk that Aave might flip a ‘fee switch’, channeling extra income earned by the platform to its stakers. This conversation is based on a proposal geared towards gathering governance opinions about the protocol’s potential to repurchase tokens using spare funds and sharing them with Aave stakers and creators of their stablecoin, GHO. This development has sparked optimism in the market regarding the project, as it suggests potential new rewards for holding and staking AAVE.

Reforming AAVE Liquidation Process

Additionally, a fresh idea aims to revamp the current “take and sell” loan recovery method, which has historically been unfavorable for the price fluctuations of AAVE. This proposed change suggests substituting this system with a “take and destroy” approach instead. Under this plan, AAVE’s GHO stablecoin and tokens representing assets deposited in the protocol (aTokens) would be utilized to carry out this process.

According to Katie Talati, who leads research at Arca, the Umbrella proposal may help reduce stressors on the AAVE market from the sell side. In simpler terms, she suggested that this proposal could potentially ease the pressure that sellers face in the AAVE market.

“The idea behind this plan is to establish a novel system, named Umbrella, that instead of relying solely on the AAVE token, it employs multiple assets to offset ‘bad debt’ within the protocol. In cases where a position is liquidated and the collateral fails to cover the costs, Umbrella would step in. This change could help alleviate some of the selling pressure on AAVE tokens.”

Deelabs, a Web3 agency, has shared that introducing buyback measures could significantly increase demand for AAVE, creating bullish momentum. Meanwhile, the Umbrella proposal is designed to counteract potential adverse effects on AAVE’s price caused by loan liquidations. These initiatives, aimed at enhancing AAVE’s token economics and improving risk management within the protocol, have sparked considerable institutional interest in AAVE tokens.

Over the past month, I’ve been quite impressed with my investment in Aave. It has consistently outperformed its peers in terms of revenue and fees generated. According to TokenTerminal, Aave has raked in an impressive $27 million in fees alone, making it the leading lending and borrowing protocol in the industry.

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2024-08-23 14:23