The governance token of the decentralized lending protocol Aave dropped 8% to $208 on Thursday, underperforming the wider crypto market. This decline occurred despite strong growth in Aave's institutional real-world asset lending arm. Technical indicators point to a bearish trend as key support levels failed.
AAVE, the governance token of the decentralized lender Aave, posted sharp declines through Thursday, dropping 8% to $208. Since Monday's high of $248, the token has shed over 16%, tumbling below $210 as crypto markets weakened.
The DeFi bluechip token carved out consecutive lower highs and lower lows, establishing clear bearish momentum while peers advanced, according to CoinDesk Research's market insight tool. Trading activity surged 40% above seven-day averages, signaling active repricing. AAVE underperformed the CoinDesk 5 Index (CD5), which fell nearly 4%, underscoring the broad-based weakness.
This correction happened despite positive developments in Aave's institutional real-world asset lending arm, Horizon. The marketplace grew above $450 million since its launch roughly two months ago.
Key technical levels signal a potential breakdown risk for AAVE. Critical support at $211.00 failed, while the $235 level capped earlier advances, forming resistance. Three volume spikes at $228, $219, and $213 confirmed selling waves. The chart patterns show lower highs and lower lows across a $26.88 range, representing an 11.4% overall price decline. A failed recovery at $212.70 sets up a deeper pullback.