Reasons for AAVE Growth and Cryptocurrency Forecast
The rapid growth of AAVE caught the attention of members of the crypto community on cryptocurrencies. Since the beginning of December, the price of the coin has increased by more than 90%
We tell you why AAVE is growing and what to expect from the cryptocurrency in the near future.
What's wrong with AAVE
Since the beginning of December 2024, the cryptocurrency AAVE has risen by more than 90%. At the time of writing this review, the coin is updating its local maximum at about $390. At the same time, the coin is still far from the absolute maximum recorded on May 19, 2021 at $666. At the time of writing, AAVE is trading 42% below itsPeak.
AAVE was last traded at current levels in October 2021. The growth in December thus allowed the cryptocurrency to be updated in three years at most.
Why AAVE is growing – reasons
Cryptocurrency is growing due to the news that the team of Donald Trump's crypto project World Liberty Financial (WLFI) is buying AAVE with funds from the sale of the native token.$1 million was used to purchase a coin from the project's walletprovided.
Recall that World Liberty Financial is a DeFi project, with the help of which the supporters of the victorious politician in the 2024 presidential elections plan to solve the problem of unavailability of banking instruments by providing their decentralized analogues. The platform is based on the tools of Aave Labs.
Another driver for the cryptocurrency's growth could be whales' interest in the project. Last week there were 3,310 large coin transactions worth over $100,000, which is the highest weekly value since 2022.
Whales' interest in the coin also confirms the growth of their AAVE balance.
Lookonchain writes that interest in cryptocurrencies was also driven by the activities of Mike Novogratz' crypto company Galaxy Digital Holdings Ltd.is displayed.
There is another factor driving the cryptocurrency's growth.On 13. December the project team announced the upcoming launch of the fourth version of the protocol.
Forecast AAVE
The prospects for further growth of AAVE are indicated by changes in the average age of invested funds in US dollars (MDIA). The metric measures the average age of all tokens on the blockchain, weighted by the average purchase price.
When MDIA rises, it suggests that the majority of cryptocurrency holders are storing their assets in wallets, which can prevent the price from rising. In contrast, a decline in MDIA signals that previously dormant tokens are coming back into circulation, which often indicates increased market activity and a possible acceleration in price growth.
On-chain data shows that MDIA AAVE has dropped significantly.If the trend continues, the price of the altcoin could exceed $400. Whale activity can support the implementation of the forecast.
On the Internet you can find much bolder predictions.Many believe that the support of the cryptocurrency by the Trump crypto project, as well as the interest of whales in the token, can push its price to a level above $ 1,000.
