AAVE Faces Bearish Trend Amid Strategic Model Shifts in DeFi

• Aave has introduced a token-centric model to consolidate revenue streams and align interests with token holders, aiming to remove uncertainty from dual economic models according to MEXC.
• The protocol's new model focuses on reinforcing value capture through sustainable revenue generation and governance transparency in decentralized finance as reported by MEXC.
• Meanwhile, Meta is leveraging stablecoin infrastructure via Stripe to facilitate payments for 3 billion users across its app ecosystem, avoiding direct token issuance and regulatory risks according to Yahoo Finance.

The token-centric approach, as outlined by Aave V4, introduces a hub and spoke model that allows for flexible and scalable lending protocols while reinforcing long-term governance and investor confidence according to MEXC. This shift is part of a broader trend in decentralized finance, where protocols aim to enhance transparency and streamline economic incentives for token holders according to MEXC. Aave Labs is also focusing on modular architecture and reinvestment features to manage funds efficiently without introducing new risks to the ecosystem according to MEXC.

On the other hand, Aave's token (AAVE) faces significant bearish pressure, with technical indicators like RSI and MACD confirming a sell signal according to AInvest. High volume and leveraged liquidation risks have further amplified downward momentum, with the AAVE/USDT pair currently at $117.90 after a 2.47% daily drop according to AInvest. Traders are advised to monitor a potential break below the $110-115 support range and a bearish divergence in the MACD for further confirmation of the downtrend according to AInvest.

What is driving Aave's token-centric model shift?

Aave's new economic model is designed to enhance transparency and reduce uncertainty for token holders by consolidating all for-profit revenue into the Aave DAO according to MEXC. This approach aims to streamline governance and ensure that borrowing activities directly contribute to the protocol's growth according to MEXC. By creating a unified revenue stream, Aave can better align the interests of protocol developers, token holders, and users within the decentralized finance ecosystem according to MEXC.

How is Meta using stablecoin infrastructure to expand payments?

Meta has partnered with Stripe, which operates a national bank trust charter and the Bridge platform, to integrate stablecoin-based payments across its app suite . This partnership allows Meta to utilize third-party stablecoin infrastructure without directly issuing its own token, thus mitigating regulatory risks that previously led to the failure of its earlier stablecoin initiative according to Yahoo Finance. The collaboration is set to launch in H2 2026, targeting remittances, cross-border transfers, and general payments for its global user base according to Yahoo Finance.

What does the bearish trend in AAVE/USDT mean for investors?

AAVE/USDT is currently under bearish technical pressure, with RSI indicating overbought conditions and MACD showing negative momentum according to AInvest. The high trading volume and leveraged liquidation risks suggest that the downward trend is likely to persist unless key support levels hold according to AInvest. Investors should closely monitor price movements below the $110-115 range and a bearish MACD divergence to assess potential further declines according to AInvest.

The Ethereum Foundation has also outlined its 2026 Protocol Priorities Update, focusing on scalability, security, and sustainability as part of Ethereum's broader roadmap according to Crypto Newsz. These strategic tracks aim to reinforce Ethereum's position as a leading decentralized platform and ensure continued innovation in the blockchain space according to Crypto Newsz. Such updates could indirectly influence the performance of Aave and its token as Ethereum's ecosystem continues to evolve according to Crypto Newsz.