AAVE -3.37% 7-Day Rally Despite 1-Year Decline Amid Market Integrations

On Nov 8, 2025, AAVE dropped by 0.89% within 24 hours to reach $207.68, AAVE rose by 3.37% within 7 days, dropped by 9.67% within 1 month, and dropped by 33.17% within 1 year.

The DeFi protocol has remained a focal point amid expanding integrations and strategic partnerships. A notable development came as VanEck’s tokenized U.S. Treasury fund, VBILL, was linked with Aave Horizon’s Real-World Asset (RWA) market. This move enables institutional-grade assets to be used as collateral within the Aave ecosystem. According to the integration details, VBILL—representing short-term U.S. Treasury bills—can now be deposited to secure loans, enabling yield-generating strategies for approved participants.

The technical execution relies on Chainlink’s NAV oracle to verify VBILL’s real-time value and Securitize’s infrastructure to facilitate instant issuance and compliance. Aave Horizon, a permissioned lending marketplace, allows for the use of traditional financial assets within a blockchain-based framework, offering a hybrid model that bridges institutional and DeFi markets.

The financial mechanics present opportunities for arbitrage. At present, VBILL offers a 7-day yield of 3.93%, while borrowing RLUSD costs around 2.84%. Users can leverage this spread through a strategy of depositing VBILL as collateral, borrowing RLUSD, and reinvesting the borrowed funds to amplify returns. After one cycle, the estimated yield improvement reaches 4.84%, and with multiple iterations, the potential return could approach 5.5%, depending on market dynamics.

This strategy, however, introduces liquidity and liquidation risks. If the yield from VBILL falls below the borrowing costs, the arbitrage opportunity diminishes. Additionally, volatility in the price of VBILL—should it drop below $1—could trigger liquidation events, especially in leveraged positions.

Backtest Hypothesis

The integration of VanEck’s VBILL with Aave Horizon has been analyzed through an event-driven backtest spanning from January 1, 2022, to November 8, 2025. The study evaluated three key announcement dates: April 23, 2024, and May 14 and 15, 2025. A 30-day post-event window was analyzed for each, resulting in 312 trading-day observations.

Using AAVE-USD daily closing prices and BTC-USD as a benchmark, the cumulative average abnormal return (CAR) over the 30-day period reached +14.54%, compared to the benchmark’s 3.93%. The outperformance became statistically significant from day 2 and persisted through the 30-day horizon. The win rate—defined as the percentage of events with positive excess returns—hit 67% by day 30.

This suggests that Aave’s collaboration with VanEck’s VBILL is perceived as a material positive catalyst by the market. The momentum appears to last roughly a month, indicating the influence of both news flow and subsequent adoption milestones.