AAVE, the native token of the leading decentralized finance platform Aave, crossed the $180 mark on March 21. According to CoinMarketCap, this represents a 1.74% increase in the last 24 hours. Over the past week, the AAVE price has risen by 8.67%.
Why Is AAVE Crypto Rising Today?
The global crypto market has been stable recently, with Bitcoin briefly going above $86,000 yesterday before settling around $84,000. Today, the price of AAVE is rising due to one key reason, even though the price change is small.
The Aavenomics governance proposal just passed its vote and introduced a new “fee switch” mechanism for the Aave protocol.
Proposed by the Aave Chan Initiative (ACI), Aavenomics enables the protocol to share its revenue with users, especially those who stake or lock their AAVE tokens.
Under this proposal, a finance committee will use extra revenue to buy back $1 million worth of AAVE tokens every week for six months. These tokens will be awarded to AAVE holders who have staked them, encouraging long-term involvement in the ecosystem.
This buyback-and-distribute plan is a big change for AAVE’s tokenomics. By reducing the number of tokens in circulation, the protocol aims to increase the token’s price while rewarding loyal users.
Aave co-founder Stani Kulechov described Aavenomics as a “fee switch on steroids,” highlighting its potential to improve the protocol’s value. Marc Zeller, a key member of the ACI, called it the most significant proposal in the project’s history, explaining that it took five years to develop.
AAVE Price Prediction: Falling Wedge Signals Bullish Reversal
The recent price movement of Aave (AAVE) aligned with a bullish forecast by crypto analyst Jonathan Carter on March 20.
Carter pointed out a falling wedge pattern on AAVE’s 12-hour chart, suggesting a potential price increase due to slowing selling pressure and increasing buyer interest.
Carter noted that AAVE was “approaching the upper resistance trendline” and observed a bullish divergence in the RSI, indicating weakening bearish pressure. He predicted the AAVE price could rise significantly if it breaks through the resistance, potentially reaching new highs like $193 and beyond.
The price of AAVE briefly reached $182.77 on March 21, confirming a slight breach in the resistance zone of $180 to $190. While the token has dropped marginally from here, this breach verifies the bear reversal expectation since AAVE is only about $12.48 from achieving the first target of $193.
If more buyers step in, AAVE could reach higher targets, potentially making gains of up to 86% if it hits $335. Investors should watch for a support level around $150-$160, as a price drop below this level could indicate a trend change.
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