AAVE Dominates DeFi Capital Share – So Why Isn’t Its Price Moving?

DeFi's sleeping giant just woke up—but the market hasn't noticed. AAVE now commands a lion's share of decentralized finance liquidity, yet its token price remains stuck in neutral. What gives?

The AAVE Paradox

While rivals bleed TVL, AAVE's vaults swell with fresh deposits. Protocol revenue hits record highs, developers ship aggressive upgrades—but the charts flatline like a Wall Street banker's sense of humor.

The Missing Catalyst

Institutional adoption? Check. Killer product-market fit? Check. So where's the rocket fuel? Traders whisper about overhanging supply or mispriced risk, but the real answer might be simpler: crypto markets move when they damn well please.

One thing's certain—when this coiled spring finally releases, the reckoning will be delicious. Just don't hold your breath waiting for 'when.'

Deposits and borrowing patterns show divergence in demand

The volume of deposits on AAVE showed that USDC was the most used, with a deposit volume of $669 million. WETH (Wrapped ETH) followed with a deposit volume of $180.3 million.

In contrast, borrowing activity was dominated by USDe and USDT, at $604.5 million and $282.7 million, respectively.

Interestingly, USDC was deposited in large numbers, but it was borrowed less, at $87.4 million. USDe, however, reversed the case with higher borrowing but low deposits.

Such a disbalance indicated a transition in the demand for borrowing more stablecoins.

From a revenue standpoint, AAVE continued to dominate the DeFi lending sector. Since January 2023, its share of total lending revenue has remained between 60% and 80%, based on Dune data.

Source: Dune Analytics

In June 2025, that figure stood above 50%, translating to a projected annualized revenue nearing $100 million.

AAVE also continued to be in its persistent activity with 1.46k active addresses and 179k holders as per IntoTheBlock.

However, the most active addresses and general holders of DeFi tokens were the most active, with DAI ranking first, then closely followed by Uniswap.

Source: IntoTheBlock

This indicates that while AAVE may be leading on capital metrics, other DeFi protocols maintain stronger day-to-day user activity.

Price stalls as liquidity crunches 

Coinalyze’s 2-hour chart showed that AAVE’s price fluctuated between $248 and $284, with the most recent rebound failing to cross previous highs.

Over the last two days, liquidity in the order books declined, adding to the sideways action.

Source: Coinalyze

Between the 24th of June and the 1st of July, Long and Short Liquidations spiked without sustained direction. The price eventually settled within a tighter band of $260–$270, though momentum weakened.

As long as the price fails to break either above the level of $284 or below the level of $260 then AAVE will stagnate in the range with deteriorating momentum.