Although it's a lesser-known altcoin than others, Aave is a decentralized lending system that allows users to borrow, lend and earn interest on up to 17 different crypto assets. It is built on the Ethereum blockchain. Originally named ETHLend, Stanislaus Kulechov founded it in 2017.
Major Signals
- Its Total Value Locked (TVL) increased from $2.03 billion at the start of the year to currently sit at $3.75 billion.
- Its trading volume also rose from $200 million on the 3rd of January to over $1 billion now.
- Since its flash loans feature was launched less than a year ago, nearly $2 billion have been issued, and this figure is expected to keep increasing.
Aave ended 2020 trading at a little over the $80 mark. At the beginning of 2021, its price was at $83, but less than a month later, it rallied to a record high at $254 with a $3.1 billion market capitalization.
Significant factors contributing to this surge include; an increase in the Total Value Locked (TVL) from $2.03 billion at the beginning of this year. However, with the rise in bitcoin and ethereum,
Aave also saw an upsurge. Its TVL currently sits at $3.75 billion, and with the addition of new tokens to its protocol, its TVL is expected to keep rising.
Another contributing factor includes its trading volume, which also rose at the beginning of the year. This was somewhat caused by investors buying the tokens for staking; 26.8% of Aave's total supply is staked on the platform. From $200 million on the 3rd of January, its trading volume has grown to over $1 billion now.
Flash loans, a protocol on the platform that allows crypto holders to use their portfolio as collateral to fund other crypto purchases, is also a causative element behind Aave's price ATH.
Although the feature was launched less than a year ago, over $1.7 billion has been issued. Aave might be the next best thing in the crypto world. What do you think?
