AAVE has become the new focus under the interest rate cut
Recently, the Federal Reserve's interest rate cut has become a hot topic in the crypto market, and #AAVE is undoubtedly one of the main beneficiaries. On that day, AAVE's price rose by about 9%, and at the time of writing, the trading price was close to $205. The positive market reaction is not only related to the macro environment but also closely tied to Aave's upcoming V4 version upgrade. This upgrade introduces a redesigned liquidation engine aimed at enhancing capital efficiency while strengthening the protocol's risk control. As soon as the upgrade news broke, market interest clearly revived, with price trends and derivative data confirming this.
Liquidation engine sparks leverage rebound
After the V4 version was released, traders quickly reacted. The previously subdued derivatives positions began to expand. According to CoinGlass data, the open contract volume increased by about $34 million within the past 24 hours. This change indicates a significant increase in market activity, especially as some large traders began to deploy funds in line with upgraded rating expectations.
However, the increase in open contract volume also means that prices are more sensitive to market fluctuations, and investors still need to pay attention to potential volatility risks. This increase in leverage participation shows that AAVE's upgrade not only changed trader behavior but also made the market more sensitive to price trends.
On-chain activities and prices rise in tandem
Not only is the derivatives market active, but on-chain transactions also show a strong willingness to participate. Data from CryptoQuant shows that since December 7, the number of active receiving addresses has nearly doubled, approaching 1,200 at the time of publication. This indicates that the flow of tokens between wallets has become more widespread, not just simple whale transfers, but rather an overall increase in network participation.
Meanwhile, the income of the Aave protocol has also seen significant growth. Data from Token Terminal shows that weekly network fees have increased by about $300,000, bringing total fees to $15.47 million. This income growth aligns with the increase in loan usage, indicating that the protocol upgrade is effectively driving the linkage between network fundamentals and price trends.
Liquidity clusters guide short-term upward movement
Despite the price rebound, the derivatives heatmap shows that there are still significant liquidity barriers above the current price. CoinGlass's liquidation heatmap indicates a liquidity accumulation zone of about $1.99 million near $223. If AAVE's upward momentum continues and the overall market environment remains stable, this area is likely to become a focal point for short-term price increases.
However, it is important to note that the recent rapid accumulation of derivatives positions means that if leverage support cannot continue, AAVE may still face a significant correction. Investors should remain vigilant about potential risks when participating.
Protocol upgrade reshapes market behavior
Overall, AAVE's recent performance highlights the profound impact of protocol upgrades on market behavior. Improvements to the liquidation engine have not only enhanced capital efficiency but also prompted rapid adjustments in the behavior of derivatives and on-chain traders. Although the growth in leverage and fees has provided momentum to the market, higher positions still indicate that prices remain sensitive to the overall market conditions.
For investors, AAVE's case illustrates that protocol upgrades can not only improve technical aspects but also directly boost market participation and capital activity, thereby providing new support for token prices. In the coming period, observing changes in derivatives positions, on-chain activities, and key liquidity ranges will be important references for judging AAVE's price trends.#加密市场反弹
