Aave was down nearly 10% the week at 25th of January, but the market response hasn’t been quite as dramatic. Open Interest [OI] is steady and Funding Rates are still positive, so traders are in no rush to exit.
On the other hand, the network is approaching a major milestone in total loans issued – this disconnect is worth a closer look.
AAVE slips, but selling pressure is measured
AAVE extended its pullback from the $170-$175 zone and drifted toward the mid-$150s. Price action showed a series of lower closes, but the decline hadn’t yet turned aggressive. RSI was neutral, so the pace was quite weak.
MACD remained in negative territory, so there was a short-term bearish trend. However, the histogram had started to go flat, so the downtrend isn’t quite as strong as we think.
Volume profile data also showed strong activity at the time of writing, so buyers were still present.
Derivatives numbers look steady
Over the past week, Aave’s [AAVE] Aggregated Open Interest [OI] was largely stable around the $130 million mark; traders haven’t rushed to close their positions despite the pullback.
Funding Rates also stayed positive for most of the period. Long positions were dominating, with traders willing to pay a premium to stay exposed.
Importantly, there was no spike or collapse in either metric, so no one’s panicking yet.
The big picture
The protocol is now closing in on $1 trillion in cumulative loans originated. This milestone is indicative of how frequently its liquidity is reused, rather than by simple capital inflows.
Features like flash loans, more efficient borrowing tools, and expansion across multiple chains have let the same pool of funds to power trade, arbitrage, and liquidate repeatedly. Over time, the demand for on-chain credit has pushed loan volumes to levels comparable with large U.S. banks.
Final Thoughts
- AAVE’s price may be down 10%, but traders are still optimistic.
- The network is nearing $1 trillion in loans issued!
