AAVE -14.6% 7-Day Drop Amid Whale Activity and Short Position Adjustments

On NOV 16 2025, AAVE dropped by 0.61% within 24 hours to reach $177.23, AAVE dropped by 14.6% within 7 days, dropped by 22.35% within 1 month, and dropped by 42.56% within 1 year.

Significant on-chain movements have drawn attention to the Ethereum and DeFi markets this week. A notable whale—previously linked to a 66,000 ETH short—has been actively managing its positions. The address recently withdrew 177,000 ETH (worth $561.3 million) from Aave and deposited 44,000 ETH ($140.2 million) into Binance. This activity aligns with ongoing speculation that the whale is attempting to cut losses from a previous purchase, which was acquired at an average cost of $3,437 per ETH. The whale is currently facing a $125 million paper loss, underscoring the high-stakes nature of leveraged DeFi trading strategies.

Arthur Hayes, co-founder of BitMEX, has also been active in the market, selling $4.96 million worth of digital assets over the past 24 hours. Among the tokens sold were 1,630 AAVE, valued at $289,000. Hayes' transactions include Ethereum-based tokens, governance tokens, and DeFi-focused assets, reflecting a broad portfolio management approach. While the market remains relatively stable, analysts project that such large-scale trades may temporarily affect liquidity and volatility, especially for less-liquid tokens.

The whale activity and large trader actions are occurring alongside significant short position adjustments on major crypto derivatives exchanges. One whale has maintained a 15x ETH short worth $26 million with a floating profit of $7 million, while also managing a 5x ZEC short with a floating loss of $20 million. These positions illustrate the complex risk-reward calculus being executed by institutional-grade traders, who are often balancing multiple exposures across asset classes and leverage levels.

Backtest Hypothesis

The ongoing market volatility and whale activity highlight the importance of robust risk management and strategic backtesting in DeFi and crypto trading. A proposed backtest involves identifying AAVE’s historical –10% (or worse) down-days between 2022-01-01 and today to assess how such events impacted subsequent price behavior. This approach requires a complete daily close price or return series for AAVE during this period to calculate the exact dates of these significant drops. Once the event dates are identified, the backtest can examine price trends and recovery patterns to evaluate whether historical –10% drops led to similar or divergent outcomes. This analysis could offer insights into potential behavioral patterns and inform more informed risk mitigation strategies for traders.