Aave climbed above $90 on Tuesday, buoyed by a flood of fresh deposits across its lending protocols. The token is trading above its 50-day moving average at $90.80, extending a mild recovery that started weeks ago. The momentum, however, masks a deeper split in the market: institutions are pouring money in while retail traders are stepping aside.
The Monad Layer 1 blockchain saw more than $500 million flow into Aave V3 over the past month. Active loans on the same network topped $215 million. Aave V4 deposits hit a record above $350 million, up over $100 million in just 30 days. The growth is real. Part of it comes from a borrowing offer that's hard to ignore, negative 0.2% rates for holders of cbBTC, WBTC, WETH and wstETH.
But the derivatives market is sending the opposite signal. Futures open interest dropped more than 6% in 24 hours to $302.15 million. The funding rate turned negative at 0.0046%, meaning short-position holders are being paid. The long-to-short ratio fell to 0.9372, confirming shorts outnumber longs. Traders are hedging, not buying.
On the chart, Aave is still well below its 200-day moving average at $112.75. A break below $90 could accelerate selling toward $70. The token needs either a surge in retail interest or a sustained rally in Bitcoin to flip the momentum. For now, it's caught between protocol strength and trader caution.
This material is informational only and should not be considered financial advice.
