Aave (AAVE) is a leading decentralized money market protocol where users can lend and borrow cryptocurrency across 20 different assets as collateral.
Lenders can earn interest by providing liquidity to the market, while borrowers can borrow by collateralizing their crypto assets to take out loans from the liquidity pools
The protocol’s native token, AAVE, is also a governance token that lets the community decide the direction of the protocol in a collective manner. AAVE surged during the decentralized finance (DeFi) boom around 2020-2021 and hit the all-time high (ATH) of $661.69 on May 18, 2021. But as newer lending protocols entered the market and became popular, volume got distributed.
Moreover, the users became more cautious of borrowing funds as the crypto market entered a bearish zone during the last few months. The platform suffered a major setback in April 2026 when bad actors who hacked the KelpDAO esETH bridge used stolen tokens worth approximately $290 million as collateral to borrow real assets on Aave. The lending protocol lost up to $230 million during the crisis.