Aave Price Up 9.52% – Time to Buy Aave Coin?

As investors get pumped about the future of decentralized finance (DeFi), there’s been a significant jump in the AAVE price. Positive sentiment around the DeFi space usually favors protocols like Aave, which are the largest and most prominent around. So, this isn’t much of a surprise.

As expected, this means that investors will be clamoring to buy AAVE and cash in. However, it is still important to do proper research to know whether AAVE is a strong buy option. We’ll lay out the details below:

Aave: Bringing New Meaning to Lending

Aave is one of the leading protocols in the DeFi market and one of the best DeFi coins around. Created in 2017, the protocol is a decentralized system that allows users to lend, borrow, and earn interest on their crypto holdings.

Built on the Ethereum blockchain, Aave takes advantage of smart contracts to eliminate middlemen from the lending and borrowing process. So, users don’t need to work with or put their faith in any institution to manage their funds. All they need to do is trust that the code will execute their orders.

Just like other DeFi lending protocols, Aave borrowers will need to post collateral to access funds. They will only be able to borrow up to the value of the collateral they post. Funds are gotten in the form of a token, which is pegged to another asset. The token is then encoded, so lenders will get their interest.

Besides traditional lending, Aave also has additional features – such as instant loans and other forms of credit and debt management that use blockchains to work.

As for AAVE, it functions as the native token for Aave. It offers several advantages to holders, including fee-free loans when denominated in the asset. Borrowers who use AAVE as collateral will also get sweet fee discounts.

Further, AAVE holders can look at loans before they are released if they pay fees in the asset. The protocol also allows borrowers who post AAVE as collateral to borrow a bit more.

AAVE Price Movements in 2021

Aave – the platform – has been popular all through 2020. With DeFi exploding in popularity, services like Aave accumulated billions of dollars in volume locked, per data from DeFi Pulse. This led to increased visibility and use for AAVE – the token.

Moving into 2021, the AAVE price jumped even higher as the asset became a large-cap crypto. The asset started the year trading at $86.7, and it soon began jumping through successive highs in value. After hitting $580 in February, the AAVE price hit a bit of a snag and struggled a bit. Even at that, it never went below the $280 line.

By May 18, the AAVE price hit its all-time high of $665.90. This coincided with jumps in all major coins, and interest in DeFi itself rose tremendously. But, the bears returned in May, crashing crypto prices in their numbers.

Following its all-time high AAVE soon started shedding value. Just five days after hitting the milestone, the AAVE price plunged to $207.8 – a drop of 68.7 percent. The plunges didn’t stop there. AAVE eventually bottomed out at $168.2 on June 22, following another market downturn that affected prices across the board.

While AAVE has tried to climb since then, it’s struggled to find its rhythm. But, with the market recovery over the past month, AAVE has gone back in the green. The asset’s one-month chart shows a 19.2 percent jump., which is pretty decent.

Currently, AAVE trades at $398.60 – up 8.3 percent in the past day and 10 percent in the past week.

AAVE: Technical & Fundamental Analysis

AAVE currently holds a murky position technically. The asset’s price is barely over its moving averages (MAs), with its 20-day MA standing at $390.50 and its 200-day MA standing at $364. AAVE will need to continue with the short-term bullish run to stay above these MAs, and possibly propel itself higher.

AAVE’s relative strength index (RSI) currently stands at 57.33. The metric has been jumping for the past two days, showing that investors are buying more AAVE as its price rises. But, considering that it is still relatively underbought, there is an opportunity here.

Buy AAVE at eToro from just $50 Now!