Aave (AAVE)
- LEND has rebranded to Aave, as of December 2020.
- The asset is built on the Ethereum blockchain.
- Its prospects as an investment asset look stable.
What is LEND Coin?
LEND (now called Aave) is a lending platform that operates on the Ethereum network and enables trustworthy, peer-to-peer loan contracts through the use of smart contracts. Digital assets are put into pools of liquidity developed for lending out to customers who want to earn interest on them. When crypto is used as collateral, it opens up a new lending option. Flash loans can be accessed utilizing the new liquidity that borrowers can get by using their crypto as collateral.
When it launched in November 2017, Aave operated under the name ETHLend. However, the company rebranded to Aave in September 2018 after a period of transition. Later on, in December 2018, the Aave community voted to change the name of the network’s native token from LEND to Aave. The transition saw LEND being converted to Aave at the rate of 1 Aae per 100 LEND. This resulted in the creation of 16 million tokens, 13,150,254 of which are in circulation and 3 million of which are held in a reserve.
Aave looks to bring in a fresh approach to lending that solves existing inefficiencies in the banking sector. Lenders and borrowers are allowed to work out essential aspects of the loan on their own, thus completely eradicating the need for intervention by a third party.
Consequently, on this platform, loan processing charges are nonexistent because of the removal of intermediaries. Lenders and borrowers now have the opportunity to define the terms of their loans as they see fit. Loans have always had some major flaws in them, and Aave’s approach to decentralized lending helps solve some of these problems because of the enhanced level of transparency.
Is Aave a good investment?
In a market full of more competitive rivals, Aave’s advantages over other products stand out. According to statistics below provided by DappRadar, the total value locked (TVL) by Aave has increased to $1.68 billion from $14.2 billion year-to-date.
During the DeFi mania that swept the world in the summer of last year, Aave was one of the biggest gainers.
A 20-coin portfolio includes more variety than any other competitor. In addition, Aave’s standout “flash loans” is considered to be the first “uncollateralized” lending option available in the DeFi world. This feature is likely to attract more investors to the platform. Based on the evaluation above, Aave is definitely a good investment.
Technical analysis of Aave
Let us now consider two extreme routes the AAVEUSD price may take in the nearest future.
Best case scenario
On the daily price chart, AAVEUSD is showing a relatively strong momentum, with its 20-EMA (green line) above its 50-EMA (red line). If the bulls keep control, they are likely to propel the price to the first resistance at $406 and possibly to the second resistance at $484.
Worst case scenario
The RSI is at 48 and the indicator line is pointing downwards, signaling increasing bearishness. If the bulls lose control to the bears, then Aave is likely to slide to $375 for the first support and possibly further down to $351 for the second support.
Should I buy Aave today?
According to the crypto data tracking site Intotheblock, 40% of holders of Aave were “in the money”, 9% were “at the money” while 50% were in “out of money” position at the time of writing.
This means that the asset is currently in a 50-50 chance of returning a profit. In addition,the site reports a 0.35% decline in the number of Telegram members following Aave in the past 7 days, pointing to a possible decline in interest in recent days.
Perhaps, Aave’s weak performance has been compounded by the rise of formidable altcoins claiming a stake of Ethereum’s market dominance in DeFi and NFT segments. Notably, since August 2021, Solana and Cardano have risen significantly due to their attractiveness for projects seeking faster and cheaper transactions.
Therefore, if other altcoins continue to eat into Ethereum’s dominance, they could steal the limelight from Aave, which operates on the Ethereum blockchain. Based on this outlook, it makes sense to exercise caution by putting your money in the Aave and at least two other altcoins outside the Ethereum ecosystem.
Will Aave hit $1,000 in a year?
Aave is currently trading at $378. For it to hit $1,000 in a year, it would have to gain 165% . This is certainly very possible, first because of the volatile nature of the crypto market and secondly because Aave has bettered that record several times before. For instance, between January 1st and July 15th 2020, it gained more than 1,500%. Hitting $1,000 in the next 12 months certainly doesn’t seem too difficult.
What is Aave Price Prediction for 2025?
Since its launch in November 2017, Aave has given a Return on Investment of 73,087%, which is by all means supernormal. In the intervening period, it has gone as low as $25 and risen to an ATH of $667, according to CoinMarketcap. Three months ago, Aave traded at $334. This means that it has risen by about 13.7% to date.
Working with a conservative figure of 10% gain per quarter for the next 4 years, then it will have grown to $564. This therefore means that at that rate of growth, if you invest $100 in Aave today, your investment will be worth $2,143 on September 7th, 2025. However, beware of crypto market volatility, which could as well put you in a losing position.
The best way to buy Aave
If you are looking to buy Aave, you can get it at Uniswap, Binance, Gemini and iTrust, which are currently among the most active exchanges. All you have to do is get a wallet address, sign up at any of the exchanges, fund your account and purchase your Aave.